As India moves closer to the Union Budget 2026, voices from across the automobile industry are calling for policy continuity, targeted incentives, and regulatory simplification to sustain growth and accelerate the shift towards cleaner mobility.
Leaders from dealership networks and consulting firms believe the upcoming budget presents a crucial opportunity to align economic growth with environmental responsibility, while also improving ease of doing business for auto stakeholders.
Vivek Datta, MD and CEO, Globe Toyota, JCBL Group, highlights long-standing regulatory complexities faced by dealerships, particularly in Haryana and Punjab.
According to Datta, dealerships dealing in diesel, petrol, and hybrid passenger vehicles often navigate overlapping approvals and compliance processes, which increases operational costs and slows decision-making.
Datta believes that streamlined regulations would:
Improve operational efficiency for dealerships
Encourage fresh investments in emerging technologies
Provide confidence to expand hybrid and alternative-fuel offerings
Simplification, he argues, is essential as dealerships adapt to a multi-powertrain future rather than a single-technology transition.
Datta draws attention to the strategic relevance of hybrid vehicles in India’s mobility ecosystem, especially in a developing economy where charging infrastructure and affordability remain uneven.
He states,
"Strong support for hybrids—practical and eco-friendly for India's emerging economy—through incentives, tax rebates, and simplified regulations will boost adoption, reduce emissions, and drive sustainable growth."
Industry leaders argue that hybrids:
Offer immediate emission reductions
Do not rely entirely on charging infrastructure
Provide a smoother transition for consumers hesitant about full EV adoption
Targeted fiscal incentives for hybrids, they believe, would expand consumer choice while supporting India’s climate commitments.
Subhabrata Sengupta, Partner, Avalon Consulting, notes that the major benefits of GST reforms have already been realised by the auto sector, bringing structural clarity and efficiency.
He says,
"The big boost to the GST has already happened. There is some discussion about extended PLI and EV subsidies, as well as EV infrastructure investment, with a focus on scrappage."
Sengupta adds that future allocations should prioritise:
Expansion of EV charging infrastructure
Vehicle scrappage programmes
Technology-driven capability building
He further notes,
"Personally, I would welcome additional allocation on e-buses (fleet modernisation and electrification much needed) and incentives on R&D (where much of the Indian Auto Comp needs to move from build to print to tech ownership)."
Experts agree that increasing budgetary support for electric buses could deliver:
Faster urban fleet modernisation
Lower per-capita emissions
Reduced fuel import dependence
E-bus deployment is increasingly viewed as a cost-effective way to decarbonise cities while improving public transport reliability.
Across the sector, there is consensus that balanced government support—covering hybrids, EVs, and internal combustion vehicles—will be critical during the transition phase.
Production-Linked Incentive (PLI) schemes, R&D support, and tax rationalisation are seen as tools that can:
Strengthen domestic manufacturing
Encourage technology ownership
Improve India’s competitiveness in global auto supply chains
As the budget announcement approaches, auto sector leaders broadly agree on three priorities:
Regulatory simplification to improve ease of doing business
Targeted incentives for hybrids, EVs and public transport
Sustained infrastructure and R&D investment
If addressed effectively, these measures could help the industry navigate technological change while supporting India’s long-term sustainability and mobility goals.