Budget 2026 fuels growth in commercial vehicles sector

The Union Budget 2026–27 has been widely welcomed by India’s commercial vehicle (CV) and mobility sector, with industry leaders calling it a forward-looking, infrastructure-led, and sustainability-driven financial plan. The government’s allocation of Rs 12.2 lakh crore for capital expenditure has reinforced confidence that investment-led growth will sustain demand for trucks, buses, and logistics assets across the country. Stakeholders believe this continued focus on infrastructure, manufacturing, and logistics will accelerate economic activity while modernising India’s transport ecosystem.

Strong push for electric public transport

One of the most significant takeaways from the Budget is the government’s plan to deploy 4,000 electric buses across multiple regions. Industry experts view this as a clear endorsement of public transport electrification as a scalable solution to urban congestion, pollution, and rising mobility demand. The initiative is expected to create a ripple effect across the EV value chain, encouraging fleet operators, component suppliers, and charging infrastructure providers to expand investments. Additionally, continued duty exemptions on capital goods for battery manufacturing and incentives for localisation are likely to strengthen domestic EV production and improve cost competitiveness.

Industry leaders back pro-growth stance

Dheeraj Hinduja, Chairman of Ashok Leyland, described the Budget as pro-growth and aligned with India’s vision of becoming a self-reliant and globally competitive economy. He highlighted that increased spending on roads, defence, manufacturing, and logistics would directly benefit the commercial vehicle industry by driving demand and utilisation. He also appreciated the government’s focus on AI, rare earths, and energy transition as key enablers of long-term industrial progress.

Rare earth corridors and EV supply chain boost

Vinod Aggarwal, MD & CEO of VE Commercial Vehicles, emphasised the strategic importance of developing Rare Earth Mineral Corridors across Odisha, Kerala, Andhra Pradesh, and Tamil Nadu. He stated that this move would reduce dependence on imports, strengthen domestic value chains, and support the manufacturing of electric motors and advanced components. He further noted that policy support for battery localisation would play a crucial role in lowering the total cost of ownership for electric vehicles.

EKA Mobility highlights clean mobility momentum

Sudhir Mehta, Founder and Chairman of EKA Mobility, welcomed the Budget’s emphasis on sustainable mobility and large-scale electric bus deployment. He pointed out that these buses could enhance connectivity across emerging tourism circuits and regional hubs. He also praised investments in high-speed rail corridors like Hyderabad–Bengaluru and Mumbai–Pune, along with dedicated freight corridors such as Dankuni–Surat. According to him, the proposed Infrastructure Risk Guarantee Fund would encourage private investment in EV and transport infrastructure.

Greener logistics and multimodal transport

Devndra Chawla, MD & CEO of GreenCell Mobility, stated that the Budget places electric mobility at the centre of India’s growth agenda. He highlighted the focus on electrifying public transport in the North-East, expanding national waterways, and strengthening freight corridors. He also pointed to initiatives like City Economic Regions and the Seaplane VGF Scheme as steps toward a more integrated and sustainable transport network that connects urban centres, industrial clusters, and tourist destinations.

Lower logistics costs and stronger supply chains

Bitan Datta of Oliver Wyman noted that investments in high-speed rail, dedicated freight corridors, and coastal shipping would improve logistics efficiency and reduce transit costs. Meanwhile, Niranjan Kirloskar of Fleetguard Filters said that higher capex and industrial expansion in Tier II and Tier III cities would boost demand for heavy machinery and advanced filtration systems.

Overall, Budget 2026 is being seen as a well-balanced policy framework that strengthens infrastructure, accelerates clean mobility, builds domestic supply chains, and supports India’s long-term vision of becoming a Viksit Bharat.