Automakers urge Pranab not to raise duty on diesel cars

Written by fe Bureau | New Delhi | Updated: Jun 7 2012, 07:40am hrs
Urging the government not to raise excise duty on diesel cars, top executives of country's leading automobile firms met the finance ministry officials on Wednesday. The finance ministry, which has been mulling over imposing additional levy on diesel vehicles, in the meantime has asked automakers to provide production data of diesel cars before taking a final decision on the issue. On its part, the executives of auto companies have told the government that they do not mind raising prices of diesel fuel, but not duties on diesel cars.

The executives who met the finance ministry officials included Pawan Goenka from Mahindra & Mahindra, PM Telang of Tata Motors, Shinzo Nakanishi of Maruti Suzuki India, and senior executives of Toyota Kirloskar Motor, Hyundai Motor India, Ford India, Mercedes Benz India and officials from the Society of Indian Automobile Manufacturers among others.

Finance secretary RS Gujral and Central Board of Excise and Customs chairman SK Goel attended the meeting from the government side. Goel had earlier this week said that the finance ministry was examining a proposal to hike excise duty on diesel cars, a move which could discourage consumption of subsidised fuel by personal vehicle owners.

The proposal is there. Consultations are being held and appropriate decision will be taken by the government in due course, Goel had said.

Fears of such hike in Union Budget had stalled the industry's plans of investing close to R4,000 crore in diesel engine investment but in the absence of any such announcements, Maruti was the first to line up investments of R1,700 crore in a diesel engine plant.