Auto and auto component players had little to cheer after India's federal budget, as

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most of their demands were not addressed.

"As far as the automotive industry is concerned, the budget did not fully meet the expectations as the sector continues to remain sluggish," Karl Slym, managing director of General Motors India said in an e-mail.

"Besides a marginal reduction of 5,000 rupees of the additional cess on bigger cars... there is nothing on the excise front for the car sector," Slym said.

Finance minister Pranab Mukherjee said in his budget speech that specific component of excise duty applicable to large cars and utility vehicles will be reduced to 15,000 rupees per vehicle from 20,000 rupees earlier.

Industry players however said government's focus on rural spending and infrastructure in Monday's budget was a positive for the auto industry in the mid to long term.

"One good thing in the budget is the focus on infrastructure development, which will create a stronger base for demand in medium to long term," said Vishnu Mathur, executive director at the Automotive Component Manufacturers' Association (ACMA).

Incentives given to farmers on Monday's budget may also boost sales of tractors, said Nikhil Nanda, executive director at tractor and auto parts maker Escorts Ltd.

"They have increased the credit limit on lending for farming to 325,000 crore (3.25 trillion rupees), and that is very welcome. But I am not sure how much of that has been put aside for farm mechanisation," Nanda said.

"But overall the budget was a non-event".

"There was some fillip for the textile and infrastructure sectors. But nothing specifically to boost growth in automobile sector," said Santosh Singhi, chief financial officer of auto parts maker Amtek Auto Ltd.

Auto parts makers had demanded a reduction in duty on raw materials as well as an increase in customs duty on finished components.

Tyre makers had demanded a reduction in customs duty on natural rubber as the duty charged on it was double the finished product, but this too was not addressed.

"The only good thing being done is the government has not taken anything back that was given earlier," ACMA's Mathur said.

The government will maintain the overall rate structure for customs and central excise duties as well as service tax, Mukherjee said in his budget speech.

The federal government had cut excise duties across the board to 8 percent in February as part of a stimulus package to revive the economy.

Shares of top automobile firms such as Mahindra and Mahindra and Tata Motors closed down 3 to 6 percent.

Auto parts firms Amtek Auto and Motherson Sumi also closed down 3 to 7 percent.

The larger auto index closed down 3.31 percent in a battered Mumbai market that ended 5.83 percent lower.