Experts call for Union Budget 2025 to focus on infrastructure, sustainability, and innovation to boost tourism and auto sector.
New Delhi: Finance Minister Nirmala Sitharaman is set to present the Union Budget 2025 on February 1. Along with key economic reforms, the Budget is expected to introduce significant measures for the tourism and automobile sectors.
Both industries have high hopes for the upcoming Budget, seeking enhanced government support to improve infrastructure and foster innovation. Experts, as reported by The Sunday Guardian, have outlined key expectations, including increased tax benefits, higher investments, and a focus on AI-driven solutions to propel growth in these sectors.
Alok K. Singh, Chairman and CEO of Travomint, told The Sunday Guardian that this year’s Union Budget has the potential to significantly impact the travel and tourism industry. He expressed hopes for initiatives that promote growth and sustainability.
According to him, developing infrastructure and improving connectivity in Tier-2 and Tier-3 cities could unlock their untapped potential, making them more accessible and appealing to travellers. Investments in airports, railways, and roadways will enhance accessibility to lesser-known destinations. Singh emphasised the importance of placing sustainability at the forefront, calling for efforts to reduce the ecological footprint while offering enriching travel experiences. Incentives like tax benefits and subsidies, he noted, can encourage a shift toward eco-friendly tourism practices. He also highlighted the need for streamlining visa processes and fostering digital transformation in travel services to boost both domestic and international tourism.
Furthermore, Singh stressed the importance of supporting local businesses and investing in skill development for hospitality professionals to meet future industry demands. A balanced focus on these areas, he said, would position the travel sector for significant economic contributions.
Mithun Jha, Director of Reservations Deal, echoed similar sentiments to the publication, emphasising the crucial role of the travel and tourism sector in driving economic development. He stated that this year’s Budget could be transformative if the government prioritizes key areas such as promoting greenery, sustainable tourism, and off-beat destinations. Jha called for the implementation of policies that balance economic growth with environmental preservation, alongside support for small and medium enterprises in tourism and hospitality. He expressed hope that the government will address challenges faced by the tourism sector and present a progressive Budget to strengthen the sustainable travel ecosystem.
Furthermore, Siddharth Patel, Founder of Greenway Mobility, advocates for GST benefits over subsidies to drive EV adoption, noting that subsidies strain working capital and are no longer essential due to increasing awareness of electric vehicles. He emphasised the need for government investments in charging infrastructure and support for local manufacturing to reduce import dependency and create jobs. Additionally, Patel highlighted the importance of tax incentives for R&D in green technologies to promote innovation, as well as clear policies on carbon credits to encourage sustainable practices and help India achieve its carbon neutrality goals.
Similarly, Pritesh Mahajan, CEO and Co-founder of Revamp Moto, stressed the importance of GST reforms for EV raw materials and components, stating that such changes could significantly benefit India’s EV manufacturers.
He explained, “Currently, while EV sales are taxed at 5% GST, raw materials and components face an 18% GST, tying up a large portion of manufacturers’ working capital in returns. Aligning the GST rate for EV components with that of EVs at 5% would improve cash flow management for manufacturers, enabling greater innovation and long-term growth in the industry.”