Transport Minister Nitin Gadkari on Thursday said that the government is not planning to ban petrol and diesel vehicles. He also said that the government is trying to bring a vehicle scrappage policy and is considering a reduction in GST (goods and services tax) on hybrid vehicles.

His statement comes amid one of the worst slowdowns faced by the Indian automobile sector in several years. Carmakers have lowered production as domestic sales saw its tenth monthly decline in numbers in August.

On Wednesday, the Society of Indian Automobile Manufacturers (SIAM) said that it is a difficult road ahead for the rest of the year for the industry as they face a deadline of April 2020 to complete the transition from BS-IV emission norms to BS-VI.

SIAM President Rajan Wadhera, speaking at Federation of Automobile Dealers Association's (FADA) annual auto retail conclave, said that the transition is a "huge challenge" considering that each vehicle manufacturer will spend close to Rs 1,000 crore on an average to upgrade their model line-up to meet the new emission norm within a short span.

He further said that the entire automobile industry's value chain-from component suppliers to dealers-are being impacted by the slowdown.