Budget 2026: Public investment, focus on infrastructure development in Budget to help tire industry, says ATMA

New Delhi: India’s tire industry stands to benefit from the government’s moves to increase infrastructure spending announced in the Union Budget 2026-2027, Automotive Tire Manufacturers Association (ATMA) said on Monday. The tire sector is closely linked to the performance of the transportation and infrastructure ecosystem and the substantial increase in public capital expenditure to Rs 12.2 lakh crore is a significant positive for long-term demand growth, ATMA said in a statement.

The higher capital investment underlines the government’s continued commitment to build future-proof infrastructure across the country, especially roads, rail links, urban mobility networks and logistics corridors, which are crucial drivers of tire demand across all vehicle segments, it added.

“The growth of the tire industry is inextricably linked to the pace of infrastructure expansion in the country. The government’s focus on increasing public investment is boosting demand for tires for both passenger and commercial vehicles,” said ATMA Chairman Arun Mammen.He further said that increased investments in the transportation ecosystem, including dedicated freight corridors and enhanced urban mobility initiatives, will support vehicle utilization and fleet expansion, benefiting tire manufacturers across the country.

However, Mammen said the long-standing problem of the inverted tax structure, which affects the tire manufacturing sector, has still not been addressed.

“We remain hopeful that this will be taken up by the government in the larger interest of the Make in India initiative,” he said.

ATMA said several measures announced in the Budget, such as improved transport infrastructure in Tier-II and Tier-III cities, are expected to boost consumption and unlock new demand opportunities for both replacement and genuine tires.