India will continue to bring down tariffs and phase out additional levies on imports as domestic manufacturing improves, a top finance ministry official said, ahead of Prime Minister Narendra Modi’s visit to the US.
“We will soon start stakeholder consultations with ministries on whether rates can be lowered further without impacting the industry,” Sanjay Agarwal, chairman of the country’s Central Board of Indirect Taxes and Customs, told Bloomberg News in an interview Thursday. “As value chains get deeper, custom duties must be reduced otherwise inefficiencies set in,” he said, without specifying when the levies will be reduced.
In the first major overhaul of its tariff structure, India removed high rates from some 8,500 industrial goods. While the tax incidence has remained the same because of additional levies on imports, Agarwal said the surcharges are “temporary in nature and would eventually be phased out.”
Traditionally, India has protected domestic industries such as automobiles and pharmaceuticals through government incentives and high import tariffs.
The Modi government has delivered a series of concessions to the White House on issues core to Trump’s agenda ahead of the two leaders’ meeting in Washington next week. New Delhi also pledged to accept thousands of unlawful migrants from the US and maintain the dollar as its trading currency.
Source Name : Economic Times