Slowdown Blues: 'Auto industry, demand will soon bounce back strongly,' says PM Modi

Prime Minister Narendra Modi said that the automobile industry and auto demand will bounce back strongly and soon. The auto industry is in the middle of a slump forcing companies to cut production in response to slow demands. The PM said that the finance ministry has had a constructive dialogue with the industry in this regard.

In an interview to The Economic Times, PM Modi said the slowdown in the auto industry is the result of some regulatory changes and passiveness in demand. "The slowdown is transient, accentuated by credit constraints, some regulatory changes and passiveness in demand. I believe that both demand and the industry will bounce back strongly and soon," he added.

He further added that he would like to assure everyone that India has a large enough market and big enough policy space to ensure growth of internal combustion engine (ICE) based automobiles as well as electric vehicles (EV). "There is no need to speculate about the growth of either of the two. We are in a unique situation where both ICE and EV based automobiles can co-exist, co-create and learn from each other," said PM Modi.

In his interview to the daily, PM Modi also addressed the crisis in the housing sector. He said that the government is focussing on reviving the housing sector and ensuring sustainable growth for developers as well as protecting the interests of home-buyers. He said, "RERA was a massive step in this direction. As a result of this step, trust in the market, which was in short supply due to the actions of a few black sheep, is returning."

"Interest paid on housing loans is allowed as a deduction to the extent of Rs 2 lakh for self-occupied property. We announced an additional deduction of up to Rs 1.5 lakh for interest paid on loans for the purchase of an affordable house up to Rs 45 lakh. Last year, we had also seen how the GST council reduced rates for under-construction housing," which, he said are 'demand-boostin measures'.

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