EU seeks lower car import tariffs from India after Trump push: Report

The European Union now wants India to get rid of tariffs on car imports under a long-pending trade deal, right after US President Donald Trump's administration sought a similar move.

Prime Minister Narendra Modi's government is also willing to reduce tariffs in a phased manner to 10 per cent from more than 100 per cent currently, according to a report by news agency Reuters.

HT.com cannot independently verify the authenticity of the information contained in the report.

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This comes despite the domestic industry lobbying for the country to retain at least a 30% tariff even if it starts reducing it, and also to not tinker with import duties on EVs for at least four more years to protect domestic players.

If the tariff cut happens, it would be a victory for European carmakers like Volkswagen, Mercedes-Benz and BMW, along with Elon Musk's Tesla which will start selling imported EVs in India this year probably made in its Berlin plant.

“For many of the key areas, the EU and India have different approaches, objectives,” the report quoted Olof Gill, the European Commission spokesperson for trade, as having said in a statement. "This translates, in some cases, in different levels of ambition,"

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India and the EU have been in trade talks regarding the matter for several years now and in February, they agreed to conclude the deal by the end of this year, according to the report.

This is because India's 4 million-unit-a-year car market is one of the most protected in the world with domestic carmakers arguing that sharp tariff cuts would wipe out investments in local manufacturing and make imports cheaper.

The companies which have especially lobbied against tariff cuts on EVs include Tata Motors and Mahindra & Mahindra, claiming that it would hurt a sector in which they have invested heavily and in which they also plan to pump more money, according to the report.

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On EVs in particular, the automakers are asking for no tariff cuts until 2029, followed by a phased reduction on limited imports to 30%, as per the report.