| Date: |
12-12-2012 |
| Subject: |
Car makers in India affected by increase of import duty in Sri Lanka |
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Higher import duty is likely to affect auto exports to Sri Lanka, which is one of the key export destinations for Indian car manufactures. Government of Sri Lanka has increased import duty on commercial and utility vehicles by over 100% and this comes after a similar move on two wheelers and small cars which were introduced in April this year.
In Sri Lanka, import duty on cars has been increased from 120 - 291% to 200 - 350%. Where imports of three wheelers is concerned, import duty has been hiked from 51 – 61% to 100% while in the case of two wheelers import duty is up from 61% to 100%.
Indian auto makers such as Tata Motors, Ashok Leyland, Bajaj Auto and M&M are major exporters to Sri Lanka. Last year the country exported vehicles worth $6 billion out of which $800 million was to Sri Lankan markets.
This percentage is likely to fall drastically in the light of additional import duties being levied on imports, the burden of which will be passed on to consumers, hitting demand to a major extent.
Society of Indian Automobile Manufacturers (SIAM), was on the lines of exhibiting an Auto Show in Sri Lanka, but the plan has been sidelined no. As of now, Indian auto industry is concerned about this issue. Government of India is already in talks with Sri Lankan counterpart.
"We have raised the issue in Colombo today through our mission. We will also be raising it diplomatically with Sri Lankan Finance Secretary, who is coming here shortly," official spokesperson in the Ministry of External Affairs said, reported PTI.
Source : rushlane.com
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