The Heavy Industries Ministry today said it has asked Finance Minister Pranab Mukherjee to impose 10 per cent customs duty on auto components in the upcoming Budget, a demand that domestic producers have batted for in the wake of increased shipments from China.
"We have already suggested to the Finance Minister a 10 per cent customs duty on any imports (of auto components) so far as auto industry is concerned," Heavy Industries and Public Enterprises Minister Vilasrao Deshmukh told reporters on the sidelines of National Manufacturing Summit here.
The minister said a similar demand was also made for power equipments.
Welcoming the ministry's proposal, Auto Component Manufacturers Association (ACMA) Executive Vishnu Mathur told PTI there was a need to protect the domestic industry from cheap imports from China.
"Currently there are about Rs 2,000 crore worth of component imports coming from China, which we are alarmed at but we are not against import of components through the completely knocked down units (of vehicle)," he said.
Mathur said customs duty was reduced in 2007 to 7.5 per cent as part of an overall inflation-control package and has since remained the same.
"There is a need to segregate between parts, which are used for automobiles and those used in products like stationary engines and customs duty on non-auto items can be retained as it is," he added.
