Fine wines and spirits and luxury cars may cost less with India softening its position on reducing import duty on these products shipped from the European Union.
The concessions are expected to be offered under the proposed free trade agreement that is being negotiated with EU. Official sources indicated a softening of stance after holding firm for several months. The concessions are likely to come in return for benefits in services sector as well as for products that Indian companies export to the 27 country trading bloc.
All these months, the government had not budged on the issue in the wake of protests from the domestic industry, which feared a flood of imports if duties were cut on these two product segments. But officials said that in case of automobiles, India was slowly emerging as a major production centre for small cars but it was not the case with top-end cars, which companies still found cheaper to import given the low volumes. "Lower duty on high-end vehicles will not necessarily result in a rush of imports because the market is limited," said a commerce and industry ministry official.
adapted from The Times of India
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