Bajaj Auto's MD Urges Govt To Reassess GST On Clean Fuel Vehicles

"I would call it a suggestion that the government should seriously review GST rates... Just as they've done the right thing with the 5 per cent GST for electric (vehicles)," Bajaj said

Bajaj Auto's Managing Director, Rajiv Bajaj, urged the government to reassess GST rates for vehicles running on clean fuels. During the unveiling of the inaugural integrated motorcycle, the Freedom 125, on Friday, Bajaj also expressed reservations regarding the reliance on "unsustainable subsidies" to encourage electric vehicles (EVs). 

Previously, in collaboration with Union Minister for Road Transport and Highways Nitin Gadkari, he introduced the world's first CNG-powered bike in three variants, starting at Rs 95,000 (ex-showroom).

"I would call it a suggestion that the government should seriously review GST rates... Just as they've done the right thing with the 5 per cent GST for electric (vehicles)," Bajaj said.

He mentioned that in the leading two-wheeler markets across Latin America and ASEAN countries, the GST equivalent ranged between 8 per cent and 14 per cent. Remarkably, the GDP per capita in these nations either matched or exceeded that of India, nearly without exception.

"So, the aam aadmi (common man) of India is the one who can afford the least out of Thailand, Malaysia, Indonesia, Brazil, etc. Then what is the logic, justification of 28 per cent GST," he asked.

Bajaj remarked that the EV segment is not experiencing significant growth currently. He noted that Bajaj Auto has contributed by pricing the new motorcycle below Rs 1 lakh (at the lower end) and suggested that the government should also lower GST to further support this initiative.

"How can sustainable technologies be promoted by unsustainable subsidies, not only in India but worldwide... we want freedom from all of this," he said.

Bajaj described the launch as pivotal: "Today, the message with the Freedom bike is Tiger Zinda Hai."  

Speaking at the event, Gadkari highlighted that India has recently climbed to the third position in the global automobile industry, trailing only behind the US and China. "Our automobile industry contributes around Rs 3 lakh crore in terms of GST and employs around 4 crore people," he said.