September 24, 2020: Commerce and industry minister Piyush Goyal said the government was working with Australia and Indonesia to ensure fair access for India-made automobiles and components to those markets. It would also look at negotiating a free-trade agreement with the European Union to allow both export and import of certain categories of vehicles, he said.
The minister also urged foreign-owned automakers in India to seek a cut in royalties from their parents, to help reduce their cash outflow and lower vehicle prices.
Speaking at the annual convention of the Society of Indian Automobile Manufacturers, Goyal said there were tariff and non-tariff barriers in certain countries which were hindering India’s exports. “In Australia, there is an import duty, which has eliminated exports there. Our tyre makers need licence to sell in Indonesia. We are working to resolve such issues through dialogue,” he said.
Goyal, who is also the railways minister, said to help the auto industry with affordable logistics, the Indian Railways was ready to reduce freight rate and would be “happy to come up with innovative credit guarantee schemes”.
Auto and auto-components are one of the 24 focus sectors for the country which India wants to develop for manufacturing and reduce the dependence on imports in them.
The government is also looking at doling out benefits for auto companies which source more locally and who have potential to increase exports from the country, the minister said. Goyal admitted that while GST had helped negate the effect of cascading taxation, there was a need to reduce logistics costs further to ensure competitiveness of exports out of India.
The minister emphasised that the agenda of the Atmanirbhar Bharat mission was not to stop the Indian industry’s global engagement nor reduce imports.
On the issue of Quality Control Orders, Goyal said these should not be seen as barriers. It is high time India starts looking at quality control and provide the world with high-quality products, he said, adding: “Quality is never expensive. It brings down the cost.”
India’s vehicle and automotive component makers are already looking at halving imports, currently around Rs 1 lakh crore a year, in the next 4-5 years, said Mahindra & Mahindra managing director Pawan Goenka.
Source: Economic Times
