Interest rates, fuel prices a drag on auto sector: Govt

New Delhi: The government today said high interest rates and fuel prices have affected the growth of the domestic automobile sector during the recent months.

“Factors like rising interest rates and hike in fuel prices have affected the growth of this sector, thereby, showing a marginal growth during the recent months,” Heavy Industries and Public Enterprises Minister Praful Patel said

in a written reply to the Lok Sabha.

[caption id=“attachment_252903” align=“alignleft” width=“380” caption=“The govt has taken various steps including implementation of the Automotive Mission Plan to boost the industry.”]  [/caption]

Referring to the Society of Indian Automobile Manufacturers Association (SIAM) data, he said during April-February 2011-12, the production of passengers cars grew only 2.5 percent year-on-year, domestic sales rose 0.31 percent and exports jumped 16.2 percent.

More from Economy

Inflation likely to be a big focus area for budget 2024, say sources Explained: Will the Bank of Japan break tradition and raise interest rates?

The government has taken various steps including implementation of the Automotive Mission Plan (2006-16) to boost the industry. It includes attracting more investments, providing a direction to help transform the industry into a global automobile player.

PTI