New Delhi, Sep 22 (IANS) GST 2.0 has quadrupled the pace of growth in Indian auto retail, with affordability emerging as the key driver of demand, FADA President Sai Giridhar said on Tuesday.
According to Giridhar, Indian auto retail registered more than 3 crore vehicles during the 11 months from October 2025 to August 2026, recording nearly 20 per cent year-on-year growth, compared with less than 5 per cent growth in the corresponding period a year earlier.
On GST 2.0 first anniversary, he said the reform, by permanently lowering the on-road cost of vehicles widely purchased across Bharat, including small cars, commuter two-wheelers, tractors and commercial vehicles, helped widen the market rather than merely bringing forward existing demand.
“The engine of this momentum has been one word — affordability,” Giridhar said, adding that the reform brought first-time and long-deferred buyers back to showrooms.
He said the strong momentum witnessed during the last festive season has continued and has now become a new normal for the industry.
Giridhar highlighted that the impact of GST 2.0 has been structural rather than seasonal, with the automobile industry recording its best-ever months across categories during the year.
He said two-wheelers, which he described as a key indicator of mass-market demand, have reclaimed a peak last seen in 2018. Alternative fuels have also overtaken petrol for the first time in passenger vehicles, while rural markets have begun to outpace urban India across categories.
Giridhar credited the government, under the leadership of Prime Minister Narendra Modi, for placing affordability at the centre of policy and said the reform has helped create a fresh cycle of consumption and growth in Indian auto retail.
At the same time, he acknowledged that automobile manufacturers continue to face cost pressures arising from global volatility in crude prices, commodities and currency movements.
“The clearest lesson of this remarkable year is this: affordability is the single most powerful lever of demand,” Giridhar said.
–IANS
pk
