The European automobile manufacturing companies will achieve most significant benefit in the next few months as there will be reduction in import duties for them, which will translate in slashing of prices for the end customer. As per the report, government is ready to announce the reduction of indispensable import duty by 50 percent on specific premium luxury vehicles imported from Europe at India-ECU summit scheduled on 10th February. Currently, imported premium luxury vehicles with 1,500 cc of engine capacity draw more than 100% duty, including basic import duty of 60%. Besides CVD or countervailing duty, the additional duty and education cess.
According to the report the official said that duty cut is needed for protecting the export interests of domestic car manufacturing companies situated in Europe. Automobile producing firms like Renault, Maruti Suzuki and Hyundai send overseas more than 2.5 lakh vehicles annually to Europe. Mr. Vishnu Mathur, Director-General of SIAM (Society of Indian Automobile Manufacturers), said that even if (EU) puts duty on Indian vehicles, it would be approximately 5-6 %, which is a normal rate in Europe.” He also stated that Europe is shrinking as market, while India is growing.