Government Likely to Reduce Duty on Import of Cars from European Union.

The cars imported from the European countries are likely to get cheaper in coming days as the government of India is mulling over the option of reducing the imported duty on top end wines, spirits and automobiles dispatched from the European Union. The reduction in the import duty of these products will be a part of the free trade agreement which is proposed to being negotiated with EU. The softening of stance over the matter of reducing import duty on these products came after government decided to give-up last few months’ firm stance on the matter.

While reduction in the import duty of these products will be benefiting the companies dispatching products to the Indian market, a few concessions are likely to be offered from EU in return to benefit the service sector in the Indian market, including a similar concession in excise duty to the Indian companies exporting goods to the 27 European countries (all members of European Union).

In a statement given to ET, commerce and industry ministry official said, "Lower duty on high-end vehicles will not necessarily result in a rush of imports because the market is limited."

At present, the customs duty on cars imported from the foreign markets stand over 100 percent. The government of India is considering implementing the use of tariff rate quotas, through which a limited number of vehicles will be allowed to be imported in the Indian market on concessional rates.

Source : cartradeindia.com