Sunday, February 5, 2012

Tata Motors Opposes Import Duty Cut

Tata Motors opposed the proposal of cutting the import duty on cars from Europe as envisaged under India-EU FTA, saying that such short-term policy shift would hinder the growth of domestic automobile industry and investment in the country, reports said.

Under the proposed free-trade agreement (FTA) officially dubbed as Bilateral Investment and Trade Agreement, EU wants India to slash the import duty on passenger cars.

The company said India, with its open liberal policy, was able to attract many global players, which has resulted in helping the industry growth and any such change in policy would create a un-level playing field.

Managing Director (India Operations) P.M. Telang said, "It will hinder the growth of the industry. It will also create a un-level playing field and any short-term policy shift is not advisable."

India is seeking greater market access in services sector among other things. Talks for the comprehensive pact were started in June 2007.

Telang said the import duty should be reduced for all the regions, adding that the company and the industry should work out a time-line together to bring down the import duty on cars.

He also sounded caution that while taking such steps the government should ensure that investments in the country do not come down, and cited the example of Australia, where after the liberalization policy on cars, assembly operations in the country had gone down drastically.

Source: Nasdaq

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