Centre may cut duty on hybrid vehicles

The Central Government may reduce import duty on hybrid vehicles to promote use of eco-friendly cars and help carmakers introduce more such vehicles in India, Union Heavy Industries and Public Enterprises Minister Vilasrao Deshmukh said here on Monday. “My department will recommend this to the Finance Ministry. We need to discuss modalities in detail to make this happen. Suggestions can come from various stakeholders that we can consider,” Mr. Deshmukh told journalists after opening the two-day ‘Fourth environmentally friendly vehicles (EFV) conference’.

Mr. Deshmukh said if India wanted to have green vehicles, it would have to offer concessions to manufacturers of such cars, otherwise nobody would come forward. “We have to give more importance to vehicles which have lesser emissions. We are still to have norms and guidelines that differentiate between hybrid vehicle and normal vehicle; and for that we will wait for the outcome of the conference,” he added.

At present, in India, import of all vehicles, including hybrid, attract an import duty of over 100 per cent, making it highly expensive for Indian customers. Earlier some auto majors tried to introduce their hybrid cars in India, but failed due to its high cost because of hefty import duty.

Mr. Deshmukh also said the targets of Automotive Mission Plan (AMP) would be achieved as per schedule. According to the AMP, the auto industry is estimated to be worth $145 billion by 2016, which would require an investment of $35-40 billion.

Earlier, addressing the conference, Mr. Deshmukh said sustainable mobility was one of the key challenges before the automobile industry.

This includes not only reducing the impact of vehicular emissions on the environment, but also attaining greater fuel efficiencies with the ultimate aim of shifting to alternative sources of cleaner and renewable energy. Underlining the need for more fuel-efficient vehicles to reduce emissions and save environment, Mr. Deshmukh said the conference would help promote use of environmentally-friendly vehicles to ensure sustainable road transport.