The Government will increase customs duty on the import of automotive components if domestic automakers do not seriously work towards increasing localisation, the Union Minister for Road, Transport and Highways, Mr Nitin Gadkari, has said.
Speaking at the sixth Technology Summit organised by the Automotive Component Manufactures Association of India (ACMA) on February 25, Mr Gadkari stressed the industry “needs to stop imports.” The automotive component makers, he said, need to develop good alternatives to imports at reasonable costs.
“I am requesting to auto manufacturing companies to take it (localisation) very seriously. Otherwise, for import of components we will think on the direction to increase more custom duty on that,” the minister said.
“It is because of the strong capabilities of the components sector that the vehicle industry in India has been able to achieve localisation levels of around 70 per cent. I urge both the vehicle and component manufacturers to increase localisation of components to the maximum. My expectation is to make it 100 pc,” Mr Gadkari said via video conferencing.
The minister further said the Government was also working on framing the final vehicle scrappage policy and on resolving issues related to shortage of raw material such as steel to encourage replacement demand and ease production challenges.