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Maruti moots proposal for export of used cars

BS Economy Bureau

India's largest car manufacturer Maruti Udyog Ltd on Wednesday mooted a proposal for second-hand car exports where auto companies would get tax benefits, including excise exemption and duty entitlement passbook scheme benefits.

In response to the suggestion made by MUL's general manager exports R K Gupta, the government said it was willing to consider the framework and sought more inputs on the subject.

"We would consider your proposal, but you should give us some suggestions on the kind of framework you would need," M K Zutshi, member, Central Board of Excise and Customs, said at an open house on Exim Policy organised by the Federation of Indian Export Organisations.

Gupta said there was a good potential for export of second-hand cars from India to neighbouring countries like Bangladesh and Nepal and also, some African countries.

He said Bangladesh imports nearly 54,000 used cars every year. Similarly, between 72 per cent and 80 per cent of the car demand in some African countries was met through import of used cars, Gupta said.

He also said some countries re-exported the imported cars within three years and also gave tax sops for the purpose.

"In India also, exporters of used cars should get benefits of schemes like DEPB and should not be made to pay excise duty on the export of second-hand cars," Gupta added.

Commerce secretary Dipak Chatterjee said for Indian companies to get a share of the used cars business in other countries it was important that they establish a good track record.

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