The automobile sector is reinforced by Budget 2026 through continued investment in road infrastructure, clean mobility, and manufacturing-led growth. Policy clarity around electric vehicles, alternative fuels, and domestic component manufacturing supports long-term transition while protecting industry stability. Here are comments from leading industry stakeholders.
Dr. Anish Shah, Group CEO & MD, Mahindra Group: We applaud the Government of India’s Union Budget 2026 presented today by Finance Minister Nirmala Sitharaman. This Budget focuses on enhancing India’s competitiveness in the world, takes meaningful steps towards atmanirbharta and enables a wider participation in the benefits of economic growth.
The emphasis on frontier and strategic manufacturing sectors, including the launch of enhanced schemes such as Biopharma Shakti and the Semiconductor Mission (ISM 2.0), reflects a clear commitment to building global-scale manufacturing capabilities. Strengthening domestic value chains and reducing critical import dependencies will be key to India’s future industrial leadership.
We particularly welcome the significant increase in capital expenditure to ₹12.2 lakh crore for FY27, which underscores an unambiguous policy focus on infrastructure, regional development and job creation across the country. This will play a pivotal role in crowding in private investment, enhancing productivity and supporting the growth of tier-2 and tier-3 cities as emerging economic hubs.
The proposal to establish a dedicated ₹10,000 crore SME growth fund and incentives for industry clusters is a positive step toward enabling future job creation, supporting enterprise scaling, and boosting competitiveness of small and medium businesses.
Initiatives to promote critical minerals, rare earth corridors and enhanced electronics and capital goods manufacturing are forward-looking and essential for a resilient industrial ecosystem that can thrive amid global uncertainties.
And, most importantly, the emphasis on sabka saath, sabka vikaas is commendable. The actions to ensure every community has access to resources and opportunities will enable robust and sustainable economic growth.
Overall, Budget 2026 signals continuity in policy direction, a firm commitment to sustainable and inclusive growth, and efforts to unlock India’s economic potential at scale. We believe these measures can accelerate innovation, enhance value-added manufacturing and strengthen India’s standing in the world
Santosh Iyer, MD & CEO, Mercedes-Benz India: Budget’s strong focus on infrastructural development, with addition of Rs 1 lakh crore in capex, is a step in right direction developing the country’s evolving mobility ecosystem. Better highways and improved intercity connectivity have historically driven luxury car demand in India. The fiscal prudence reflected in the 4.3% deficit target, combined with strong focus on exports, sends a strong signal of macroeconomic stability, which may lead to a less volatile currency. Overall, the emphasis of the budget is on strengthening ease of doing business, and the deferral of customs duty payments up to 30 days, can improve cash flow significantly. This budget primarily focuses more on long-term gains, rather than immediate ones.
Mohal Lalbhai, Founder & Group CEO, Matter Motor: The Union Budget 2026 reinforces the Government’s long-term focus on strengthening India’s advanced manufacturing ecosystem, even as direct EV-specific incentives remain measured. The emphasis on strategic manufacturing, India Semiconductor Mission 2.0, and high-precision engineering underlines a clear shift towards capability-led growth over short-term subsidies. For electric mobility, this is critical. Future competitiveness will be driven by power electronics, battery management systems, motor technologies, intelligent vehicle platforms, innovation in alternate materials, and Advanced Integrated Drivetrain Vehicles (AIDV). The Budget’s focus on critical minerals, rare earth processing, and component ecosystems supports resilient, India-based supply chains for next-generation EV powertrains. At MATTER, built on deep in-house engineering and integrated manufacturing, this policy direction aligns strongly with our approach, enabling Indian EV companies to compete globally on performance, innovation, and export readiness in line with the Innovate in India, Make in India, Make for the World vision.
Mr. Sidhartha Bhushan Khurana, Managing Director, STUDDS Accessories Ltd., The Union Budget 2026 provides a steady and pragmatic framework for India’s manufacturing transition. By scaling capital expenditure to ₹12.2 lakh crore and focusing on City Economic Regions, the government is effectively strengthening the infrastructure that drives consumption in Tier II and III cities—the primary growth engines for the two-wheeler industry.
The ₹10,000 crore SME Growth Fund and the mandatory adoption of TReDS are critical structural shifts that will address long-standing liquidity and scaling hurdles within the MSME ecosystem. Similarly, the High-Powered ‘Education to Employment and Enterprise’ standing committee is a necessary step to align our talent pool with the evolving needs of high-tech manufacturing as we aim for a 10% global share by 2047.
As an organization deeply committed to Road Safety, we see the government’s focus on ‘National Kartavya’ as a shared responsibility. This budget balances the need for resilience with a clear roadmap for capacity building, creating a constructive environment for Indian manufacturers to expand their footprint both domestically and globally.
Mr. Arnab Banerjee, MD & CEO, CEAT: The Union Budget lays a strong foundation for sustained growth across India’s mobility and manufacturing ecosystem, with continued emphasis on infrastructure development, expansion of freight and logistics networks, and focused support for construction and equipment manufacturing directly translating into higher vehicle utilisation on roads and worksites. This, in turn, drives demand for tyres across commercial and passenger segments, while the push for Tier II and Tier III city growth further broadens mobility needs beyond metros, creating a durable demand environment and a positive long-term outlook for the automotive and tyre industry. Importantly, the focus on education infrastructure and skilling including measures that encourage greater participation of women in technical and professional roles will help industry build a more diverse, future-ready manufacturing. workforce.
Mr. Stéphane Deblaise, CEO, Renault Group India: The Union Budget 2026–27 sends a strong and reassuring signal of policy continuity and intent for India’s manufacturing-led growth. Anchored in the Kartavya pillars for Viksit Bharat, the Budget demonstrates a clear commitment to building resilience, competitiveness and technological depth across strategic sectors. The progression to India Semiconductor Mission 2.0, with its focus on equipment, materials, full-stack Indian IP and supply-chain strengthening, aligns closely with the evolving needs of the industry. The targeted push to reduce critical import dependencies, through initiatives on rare earth magnets and continued customs duty exemptions on capital goods for lithium-ion cells, creates confidence for deeper localisation and sustainable mobility. Supported by public capital expenditure of ₹12.2 lakh crore and enhanced logistics corridors, the Budget provides greater momentum to responsible growth of the Indian economy
Mr Ganesh Mani, CEO of Switch Mobility: This budget marks a defining moment for commercial electrification. The ₹1,500 crore PM E-DRIVE allocation for e-buses and e-trucks, along with the Purvodaya Initiative’s 4,000 e-buses for Eastern states, makes electric public transport a national priority. With customs duty exemptions on critical minerals and charging infrastructure development, the government is addressing the entire value chain, from manufacturing to deployment. The road ahead is clear: clean mobility in India is no longer experimental; it is industrial and irreversible.
