Coming out against the proposal to cut import duty on cars from Europe as envisaged under India-EU FTA, Tata Motors has said that such short-term policy shift will hinder the growth of domestic automobile industry and investment in the country.
The company said India, with its open liberal policy, has been able to attract many global players that has resulted in helping the industry growth and any such change in policy will create a un-level playing field.
“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,” Tata Motors Managing Director (India Operations), Mr P.M. Telang, told PTI here today.
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.
India is seeking greater market access in services sector among other things. Talks for the comprehensive pact were started in June 2007.
Mr Telang said if at all the import duty would be reduced it should be for all the regions. The company and the industry should work out a timeline 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. Mr Telang cited the example of Australia, where after the liberalisation policy on cars, assembly operations in the country had gone down drastically.
When asked about the benefits to Jaguar Land Rover (JLR), if at all the import duty from Europe on cars would be reduced, he said it is premature to be specific.