The import tariff on tyres needs to be raised to be on par with that of the key raw material, says Automative Tyre Manufacturers Association (ATMA). In its pre-budget note to the Union government, ATMA has pointed out that the import duty on NR (natural rubber) is 20%, while tyres can be imported at 5% duty or even a nil rate, under various trade agreements.
“For successful implementation of the Make-in-India campaign and to promote domestic manufacturing, it is important that import of finished products attract duties at least as much, if not more, than what is levied on raw materials,” said Raghupati Singhania, ATMA chairman, in his letter to Centre.
While tyres (finished product) can be imported into India at concessional duties under various trade agreements, NR, which falls in the negative list across most trade agreements, does not enjoy any concession. Tyre is perhaps the only finished product on which ‘duty inversion’ not only continues but has actually aggravated in recent years, according to ATMA.
Singhania has asked for increase in customs duty on tyres from basic rate of 10% at present to 20% and putting imports of tyres under negative list in all trade agreements where NR is also in the negative list. “This needs to be addressed, on priority,” he adds.