India EU Trade Deal: The long-running free trade agreement talks between India and the European Union have now reached an important stage. Meanwhile, preparations are being made by the government to take a big step. Under which it has been proposed to make a major reduction in the heavy tariff imposed on cars coming from Europe. According to sources, under this scheme, it is being considered to reduce the current 110 percent fee to 40 percent.
According to Reuters report, this discount will be given on selected vehicles imported from 27 countries of the European Union. Whose import price is more than 15,000 Euros which is about 16 lakh 26 thousand rupees in Indian Rupees.
With this decision of the government, European car companies may get a better opportunity to increase their presence in the Indian market. At the same time, the possibility of finalizing the free trade agreement between the two sides has also strengthened.
Preparation for further reduction in import duty
As talks between India and the European Union progress, further relief on import duty is expected. According to media reports, a plan is being worked on to gradually reduce the duty on cars to 10 percent in the coming time. If this proposal is implemented, it will become easier than before for big European companies like Volkswagen, Mercedes-Benz and BMW to sell their vehicles in the Indian market.
The report also states that India has agreed to immediately cut taxes on about 2 lakh petrol and diesel vehicles every year. However, this number may change after the final agreement.
These companies will benefit directly
If the trade deal between the Indian government and the European Union remains positive. Also, if the Indian government decides to reduce tax on imported cars, then big European automobile companies like Volkswagen, Mercedes-Benz and BMW will directly benefit from it. It will become easier for these companies to access the Indian market.
India is the world’s biggest car market
Despite being one of the largest auto markets in the world, very high taxes are imposed on foreign cars in India. In terms of market, India comes third after America and China.
But here import duty ranging from 70 percent to 110 percent has to be paid on fully built cars. For this reason, officials of many international auto companies have been raising questions on this tax policy of India from time to time and consider it challenging for business.
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