Auto Industry presses to retain excise duty benefits

  • Jun 13, 2014
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  • By Pti
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The excise duty benefits say Industry experts will help arrest slowdown

Auto Industry presses for Excise Duty benefits

In a bid to arrest slowdown in the manufacturing sector, India Inc pressed to the government for continuation of excise duty benefits to the auto industry. 

The demands were stated during an interaction with Commerce and Industry Minister Nirmala Sitharaman here. 

"It was a very interactive and useful session. Lots of ideas have come. Several issues related with Budget also came up for discussion. I will discuss that with the Finance Minister," Sitharaman here. 

"It was a very interactive and useful session. Lots of ideas have come. Several issues related with Budget also came up for discussion. I will discuss that with the Finance Minister," Sitharaman told reporters after the 90-minute meeting with the representatives of industry chamber CII. She said she would hold discussions on specific sectors in the coming months and address issues concerning the industry with a view to boost manufacturing. 

Mahindra Executive Director Pawan Goenka said that he raised the issues concerning the auto sector and demanded continuation of lower excise duties for the automobile industry. "Without the growth in auto sector, it will be difficult for the country to grow in double digits...we made a very strong request about the continuation of excise duty relaxation for the sector in the Budget," Goenka said. Auto sector contributes about 7 per cent in the country's economic growth. 

In the Interim Budget earlier this year, the then Finance Minister P Chidambaram had reduced excise duties on small cars, scooters, motorcycles and commercial vehicles to 8 per cent from 12 per cent. Similar duty cuts were provided for SUVs and large cars. The duty cuts were to remain in force till June 20. The BJP-led NDA government will have to take a call on continuation of the lower duty rates on auto sector in the final Budget to be presented by Finance Minister Arun Jaitley next month. 

CII President Ajay Sriram in his presentation raised concerns with regard to declining growth in manufacturing and made a case for fiscal consolidation. "We talked about how we can encourage SEZs, deal with increasing cost of doing business and bring down high transaction cost," he added. 

Due to poor performance of manufacturing sector the Index of Industrial Production ( IIP) declined by 0.1 per cent in 2013-14. It had registered a meagre expansion of 1.1 per cent in 2012-13. 

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