Patel hints at import duty concessions on luxury cars from EU
Minister of Heavy Industries and Public Enterprises Praful Patel Monday hinted at his ministry's willingness to accept cutting duties on luxury cars imported from Europe as part of India-EU Free Trade Agreement.
New Delhi: Minister of Heavy Industries and Public Enterprises Praful Patel Monday hinted at his ministry's willingness to accept cutting duties on luxury cars imported from Europe as part of India-EU Free Trade Agreement.
The minister said such a move would be to safeguard India's interest of small car exports to Europe.
"The India-EU FTA has to be concluded at some future date, of course it cannot be open ended. We also export a lot of smaller vehicles into the EU and we would like to continue to do that and increase that volume," Patel told reporters on the sidelines of SIAM's summit on diesel technology here.
The domestic automobile industry, under the aegis of Society of Indian Automobile Manufacturers (SIAM), has been opposing giving out any relaxations on import of vehicles from Europe stating that any such move will be detrimental to the growth of investments here that may affect job creations too.
"We also need to arrive at some kind of, say, mutually agreeable formula, where EU's some concerns on larger vehicles can be addressed," he said, however, adding India "has not changed its stand at the moment".
In the past, Patel had expressed opposition to reducing import duties in cars from Europe.
"At the same I must say that we are also a huge exporter of small vehicles into the EU. That fact also has to be borne and kept in mind, otherwise we should also not be in a situation, where we discourage the exports of our products -- smaller vehicles, including into the EU," Patel said.
Asked specifically how much duty concession could be given on automobile imports from Europe, he said the government has not decided yet on "any number, neither we have decided on any quantum".
During Budget for 2012-13, basic customs duty was hiked to 75 percent from 60 percent for fully imported vehicles priced over USD 40,000 and with engine capacity of over 3,000 cc and 2,500 cc for petrol and diesel driven vehicles.
"Between the negotiators, Commerce Ministry and us, we held couple of rounds of meetings, and we will reiterate our stand in the discussions, but at the same time let us see what is the proposal coming from the other side and then we will take a final call," he said.
Patel further said his Ministry and the Commerce Ministry have held discussions recently on the issue and have agreed on maintaining India's old stand of attracting more investments and encouraging manufacturing activities in the country.
"As I said, we must continue to maintain our original stand that at this moment we cannot allow many concessions for the simple reason that we want to have manufacturing activity increasingly more in India, and as a result of all these safeguards in the past, we have seen all automobile manufacturers now setting up their big plants in India.
"But one thing is certain that we in our country must have much more manufacturing taking place and that is why India's position has been in the past," he added.