Big Trade Talks : The commerce department has earmarked autos as one of the products for consultations with other departments and ministries before negotiations for the proposed bilateral trade pact with the US — signalling that the government is seeking inputs for a possible duty reduction for bikes and cars, such as Harley Davidson and Tesla.After consultations, auto is among the sectors that have come up where the commerce department feels it can offer duty cuts, sources told TOI.
Discussions are on at the level of commerce secretary Sunil Barthwal to assess India’s offensive interests that is needy and seek reduction in the import duty from the US and defensive interests — where it is likely to have to make concessions.Ministries and departments have, in turn, been asked to return with industry inputs for a comprehensive view to be taken on the sector.
Trump’s outbursts in recent weeks – along with the decision to slap 25% tariffs on auto imports into US – have made cars and bikes a defensive-interest area in India’s ties with the world, particularly since Americans – or at least the American establishment – see steel and automobiles as key sectors where the world’s largest economy should reclaim the dominant position it’s had to concede to China over the years. He has cited high tariffs in India as a impediment to U.S. exports repeatedly, including on Tuesday, and said companies like Harley Davidson and Tesla have no option but to build factories in India.
This comes even as the government reduced import duty on Harley Davidson and other motorcycles in the Budget, and also cut basic customs duty on cars to 70%, while keeping the effective levy with cess at 110%.The other interest for Trump is plain-old easier access for American agricultural goods, such as pecan nuts and fruits, even if the UAE has cornered a large share of the almond and pistachio market.
For India, while textiles and footwear, as also some of its farm products, will figure in the offensive list, non-tariff barriers will also prominently feature in the negotiations as the two countries look to expand their overall trade from less than $200 billion now to $500 billion by 2030.