New Delhi, June 12: The government is believed to have allowed Honda Motorcycle and Scooter India (HMSI) to pay $2,00,000 to its parent company as technical license fee for the recently-launched 150cc scooter ‘Eterno'. Besides, the Indian company has also been permitted to pay royalty to Honda Motor Company of Japan ranging from 1-4 per cent of domestic sales and exports between now and after April 1, 2005, sources said.

HMSI, a 100 per cent subsidiary of Honda Japan, presently pays a royalty of one per cent on domestic sales and exports till April next year after which it would be increased to two per cent till March 31, 2005 and four per cent thereafter, they said.
The company has stated that the royalty payments be treated under the automatic approval route as it was within the government limits of five per cent of domestic sales and eight per cent on exports.
HMSI which is one of the leading scooter makers in the country produces the 100cc 'Activa', 'Dio' and 150cc 'Eterno' scooters at its plant at Manesar (Haryana). The company has also announced that it would start producing motorcycles with 50cc to 250cc engine capacity from next year. Bureau Report