Reduce duty on Harley Davidson to nil: Report

By February 25, 2020General Posts

The report by the US India Business Council (USIBC) and Confederation of Indian Industry (CII) said the 0% rate could apply to all motorcycle imports being sold in India over Rs 5 lakh.

NEW DELHI: India should consider bringing down the import duty on high-end motorcycles (that include Harley Davidson motorcycles) to 0% for both complete built up (CBU) units and for completely knocked down (CKD) units, a joint report by two industry lobby groups suggested on Tuesday as part of an overall strategy to boost India-US trade to $500 billion.

The report by the US India Business Council (USIBC) and Confederation of Indian Industry (CII) said the 0% rate could apply to all motorcycle imports being sold in India over Rs 5 lakh.

The report has listed out interventions in 13 specific areas, which if resolved, will provide a thrust to trade between the two countries. Interventions range from reinstating Generalised System of Preferences (GSP) benefits by US for India, arriving at a consensus on a pricing mechanism for medical devices, modifications in India’s e-commerce policy, removing high tariffs on steel and aluminium imports by US, fostering greater cooperation in strengthening partnership in defence and aerospace.

“In 2017-18, Harley Davidson sold 3,413 units in India – a decline of 7% from the previous year. For CBU units, India had already slashed duties from 75% to 50% in 2018, but given that the duties apply to a minuscule percentage of the overall trade and for a very niche product, eliminating it altogether would provide a symbolic win for the US,” the report said.

It said issue of price controls for medical devices has invited vigorous discussions and was one of the original reasons why US Office of the Trade Representative (USTR) decided to review India’s eligibility for GSP programme

The report said India’s e-commerce policy, however, has engendered a whole host of issues that impact both domestic and foreign players, including definition of private versus community data, prohibition on cross-border data sharing, mandate to establish data centres holding sensitive data of Indians within the boundaries of India, informed consent, following due legal process in data sharing with Indian or foreign authorities, domestic versus Indian – product definitions; requirement for e-commerce app/websites to set up legal entities in India.

“India must also bear in mind that such a policy could prompt reciprocal action by US and other countries which may demand that the data for their citizens stay within the confines of their geographical boundaries. This could have an enormous deleterious impact on Indian IT and business process outsourcing (BPO) companies that have grown over the past several decades essentially by processing, analysing and storing sensitive health, financial, insurance etc. information for customers from other countries within India – the US is a major market for such firms and helps generate thousands of jobs in India.”

Harley has to pay huge duty in India, Trump revives import duty debate

“India is probably the highest tariff nation in the world. The United States has to be treated fairly and I think India understands it. We have a large deficit of $24 billion with India and that it is very high”. Trump Said

NEW DELHI: U.S President Donald Trump calls out India-US tariff a problem mentioning the American motorcycle manufacturer Harley Davidson has to pay high import tariff in India.

While addressing a media conference in Delhi, he said, “India is probably the highest tariff nation in the world. The United States has to be treated fairly and I think India understands it. We have a large deficit of $24 billion with India and that it is very high”.

However, he indicated that a trade deal with India could happen at the end of the year. “Working it out with India on tariffs,” President Trump said.

India reduced the customs duty on complete built-up units (CBUs) from 100 percent to 50 percent in 2019. Even then Trump criticized the import duty and called out “too high” and “not acceptable”.

On the other hand, India increased tariffs on completely knocked down (CKDs) units from 10 per cent to 15 percent. Harley Davidson’s majority of sales come from the CKDs which are assembled in India.

In FY2019, Harley Davidson sold 2676 motorcycles. It sells 17 Models in India which ranges from ₹5.33 lakh to ₹50.3 lakh.

Before Trump India Visit, India proposed a new tariff classification for motorcycles with a cylinder capacity exceeding 1,600 ccs, imports of which will be taxed in single digits.