SIAM hits out at FTA to cut import duty on cars

Stating that India will gain nothing from the proposed FTA with the European Union, automobile industry body SIAM, on Saturday, reiterated that the sector should be kept out of the purview of the pact.

“The Society of Indian Automobile Manufacturers (SIAM) has also written a letter to Prime Minister Manmohan Singh protesting the inclusion of the automobile sector in the negotiations,” an official of the industry body said.

“We understand that the government of India is now considering a reduction of tariff for CBUs (Completely Built Units) under the India-EU FTA, which will be a reversal of the policy of high tariffs to force investment, local manufacturing, local value addition and local employment,” the industry body said in a separate statement.

Stating that has been no open debate and the entire regime is forced on the people of India without any sectoral cost-benefit analysis, SIAM said that it is not convinced that India is going to gain anything substantial out of this FTA.

“In agriculture, we do not have capacity to export even if we gain market access, since we are not able to feed our own people and already facing a runaway food inflation situation in the country, which is de-stabilising the entire economy,” it added.

Also, SIAM does not believe that the EU will allow large-scale import of Indian agricultural produce and it can be easily stopped through non-trade barriers. The industry body also said India’s free trade agreements with other countries like Japan have not resulted in any benefit for the country.