Europe's withdrawal of concessional tariff to affect auto exports
Updated: Dec 05, 2013 12:08:54pm
New Delhi, Dec 5 (KNN) With Europe having decided to withdraw a concessional tariff regime for India and some other developing nations with effect from January 2014, export of bicycles among other motor vehicles is likely to be affected.
“For bicycles present GSP duty is 10.5 per cent and this rate will go up to 14 per cent and 15 per cent respectively for two tariff lines. Thus, around USD 6 to 8 million of bicycle exports are likely to be affected. South Asian countries like Bangladesh, Pakistan may find it easier to compete and develop this segment,” EEPC India said.
The other sectors which will be affected by the EU regulations are aircraft parts, ships and boats.
The EU step of increasing duties on Indian imports follows suspension of generalised system of preference (GSP) through its regulation of December 17, 2012.
Commenting on EU’s regulation, export of motor vehicles of USD one billion will be adversely impacted dealing a blow to the automobile industry which has seen a sharp fall in domestic sales in November and was counting on pick up in exports, the EEPC India Chairman, Anupam Shah said.
The duty rates according to him will increase from the present 6.5 per cent to 10 per cent.
Significantly, export of motor vehicles with engine capacity between 1000 and 1500 cc, in particular, will find their import duties being raised.
“Their exports will face roadblocks especially as they will face competition from other auto exporting countries,” Shah added.
The EU seems to have taken this step as it would like India to take a flexible position in the India-EU Free Trade Agreement negotiation with specific reference to the auto sector.
Total exports from India to EU countries of these products amounted to USD 2.2 billion in 2012-13. This amounts to 20.2 per cent of USD 10.79 billion of total engineering exports in 2012-13 to EU.
With regard to aircraft and spacecraft segments, India has essentially exported parts of aircraft and similar aerial objects. The duty will increase from the present nil duty to 2.7 per cent, EEPC India (formerly Engineering Export Promotion Council) noted.
Under the circumstances, Shah has urged the Indian government to immediately intervene and take up the issue with the EU at the highest level.
“Since these are high value added items, the duty will have a severe impact and exports worth USD 600 million will be negatively affected,” he said.
For ships and boats, in certain tariff lines like Dredgers, the MFN (the most favoured rate) rate of EU is zero but in certain other tariff lines, the rate will increase from zero to 1.7 per cent. Thus, exports to the tune of USD 400 million will certainly be impacted negatively. (KNN)
“For bicycles present GSP duty is 10.5 per cent and this rate will go up to 14 per cent and 15 per cent respectively for two tariff lines. Thus, around USD 6 to 8 million of bicycle exports are likely to be affected. South Asian countries like Bangladesh, Pakistan may find it easier to compete and develop this segment,” EEPC India said.
The other sectors which will be affected by the EU regulations are aircraft parts, ships and boats.
The EU step of increasing duties on Indian imports follows suspension of generalised system of preference (GSP) through its regulation of December 17, 2012.
Commenting on EU’s regulation, export of motor vehicles of USD one billion will be adversely impacted dealing a blow to the automobile industry which has seen a sharp fall in domestic sales in November and was counting on pick up in exports, the EEPC India Chairman, Anupam Shah said.
The duty rates according to him will increase from the present 6.5 per cent to 10 per cent.
Significantly, export of motor vehicles with engine capacity between 1000 and 1500 cc, in particular, will find their import duties being raised.
“Their exports will face roadblocks especially as they will face competition from other auto exporting countries,” Shah added.
The EU seems to have taken this step as it would like India to take a flexible position in the India-EU Free Trade Agreement negotiation with specific reference to the auto sector.
Total exports from India to EU countries of these products amounted to USD 2.2 billion in 2012-13. This amounts to 20.2 per cent of USD 10.79 billion of total engineering exports in 2012-13 to EU.
With regard to aircraft and spacecraft segments, India has essentially exported parts of aircraft and similar aerial objects. The duty will increase from the present nil duty to 2.7 per cent, EEPC India (formerly Engineering Export Promotion Council) noted.
Under the circumstances, Shah has urged the Indian government to immediately intervene and take up the issue with the EU at the highest level.
“Since these are high value added items, the duty will have a severe impact and exports worth USD 600 million will be negatively affected,” he said.
For ships and boats, in certain tariff lines like Dredgers, the MFN (the most favoured rate) rate of EU is zero but in certain other tariff lines, the rate will increase from zero to 1.7 per cent. Thus, exports to the tune of USD 400 million will certainly be impacted negatively. (KNN)
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