Facing its worst decline in sales since 1997-98, the automobile sector has been clamouring for measures to rejuvenate demand, including relaxation in GST rates.
Sitharaman was addressing the media in Chennai on NDA government completing 100 days of its second term. The industry saw a 12.25% decline in production in April-August 2019 compared to a year ago.
Amid concerns over the slowdown in the automobile sector, Finance Minister Nirmala Sitharaman on Tuesday reasoned that "millennial mindset" of using app-based cab services were the reason why people were not buying cars.
Sitharaman also talked about GDP data which was around five percent in the last quarter and said that the government was aware of the economic challenges and the government officials were in talks with representatives of different industries.
Being in the automobile capital, Chennai, the minister when peppered with questions on the slowdown in the sector, said to be the worst in almost two decades, said, "It is true that the automobile sector in India had a good time till two years ago, there was definitely a good upward trajectory for automobile sector".
The Finance Minister also said the government will respond soon to the demands of home buyers.
Automobile sales witnessed its worst-ever drop in August across categories, with passenger vehicle sales falling by as much as 41.09 per cent, according to data released by industry body SIAM. They also cut production, which led to a decline in dispatch to dealers.
Commenting on Centre's decision to merge different public sector banks, she said, "The government has announced merger of 10 public sector banks (PSBs) into four strong lenders with countrywide networks and global reach to boost credit and revive economic growth".
Last year, the Supreme Court had ruled that no Bharat Stage (BS) IV vehicle shall be sold across the country with effect from April 1, 2020.
While stating that bank mergers were announced for the banks to benefit from each other, the FM said the date of merger had to be decided by the boards of respective banks. This is down from a GDP growth of 8.2% in the first quarter of the previous financial year.
"It is useful for us to remember that dips and raises in GDP growth happens".