Anand Mahindra Calls For Stable Policy Environment

There is a stronger need today than ever before for a proper roadmap for industry, according to Anand Mahindra, Chairman and MD, Mahindra Group. Speaking in an exclusive interview to NDTV, Mr. Mahindra says this with context to government policy that may worry industry, and affect how much investment India attracts in the future. The government has come into criticism off late for its variable GST rate structure, and subsequent flip-flops as seen in the automobile space in particular - with a post-facto hike in the cess charged on most categories of passenger vehicles. Many in the automobile industry have spoken out against this, including the Hyundai MD, YK Koo.

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But Anand Mahindra was speaking on a larger level, not just with context to the recent cess hike, when he said, "Investment and business thrive in a more stable environment, there's no question about that. If one could lay out a predictable roadmap for the automobile industry and the technology within it, we would welcome that. Yet as a citizen I am sitting there and thinking to myself that, If we can't lay out a roadmap ourselves given the rapid changes in technology, then it's very hard to imagine somebody else doing that. And so the question of policy changes is unfortunately going to become a feature - not just here but everywhere else."

Rapidly changing technology and industry standards are forcing governments around the world to react quicker to changes. Of course this means policy also must play a catch up role, and so further disruptions may be inevitable says Mr Mahindra. But he adds that there is a way around this. "I think the government has to find a balance. They have to find a way in my opinion, of giving industry a sense that - look, we are both facing uncertainty together. We need to do it together. I think the industry - whether OEMs from abroad or Indian OEMs - they would not get so spooked by all of this, if there was a kind of feeling of being in it together with the government. So we're going to face this uncertain future together. I think if that signal is sent out, and if that's the sensibility, then it's not the changes that will turn anyone away from India. It's only the feeling of alienation. My submission would be that we need to work on this together."

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While rolling out GST at variable rates in July, the government had stated that cars would not only attract the highest slab at 28 percent GST, but also a further cess of 1 percent on small cars, and 15 per cent on larger ones. At the end of August the Cabinet cleared a proposal to further hike the cess on many car segments. Earlier this month the GST council ratified this, though did not impose the complete hike as proposed at 10 percent and instead chose to increase the cess on midsize cars by 2 per cent, larger cars by 5 per cent and SUVs by 7 per cent.