NEW DELHI: Automobiles are among the list of items identified by the commerce department for consultations with other departments and ministries ahead of negotiations for the proposed bilateral trade agreement with the US – an indication that govt is seeking feedback for a possible duty cut for bikes and cars such as Harley Davidson and Tesla.
Sources told TOI that the commerce department is looking at the list of sectors where it can offer duty cuts following consultations and auto figures prominently.
The discussions are being held at the level of commerce secretary Sunil Barthwal to identify India’s offensive interests, meaning areas where it would seek a reduction in import duty from the US, as well as its defensive interests – where it may have to offer concessions.
Ministries and departments, in turn, have been told to come back with feedback from industry so that a final view on the sector can be taken in a comprehensive manner.
Given Trump’s outbursts in recent weeks – as well as the move to impose up to 25% tariffs on auto imports into US – cars and bikes are seen as an area of defensive interest for India, especially as Americans see steel and automobiles among sectors where the world’s largest economy should regain its dominant position that it has had to concede to China in recent years.
Trump has repeatedly flagged high tariffs in India as a concern, including on Tuesday, and said that companies such as Harley Davidson and Tesla are left with little choice but to set up factories in India.
This is despite govt slashing import duty on Harley Davidson and other bikes in the Budget, while lowering the basic customs duty on cars to 70%, although the effective levy, including cess, has been retained at 110%.
For Trump, the other area of interest is easier access for American agricultural goods, such as pecan nuts and fruits, despite cornering a dominant share of almonds and pistachios.
For India, sectors such as textiles and footwear, as also some of its farm products, will be areas of offensive interest with non-tariff barriers too expected to figure prominently in the discussions as the two sides seek to expand trade from less than $200 billion to $500 billion by 2030.
