India: Bicycle makers ask government to slap safeguard duty

28/03/2012 12:00 - 420 Views

The effect of the hike in customs duty on imported bicycles from 10 to 30 per cent in the Union budget has started becoming visible in the market. Domestic manufacturers have started getting more orders because the price difference between imported and Indian bicycles has now increased to around 20 per cent.

Children’s bicycles have become cheaper by nearly Rs 100 compared to Chinese bicycles and even hi-end bicycles are now cheaper by more than Rs 200. Earlier, Indian models were not being preferred because of the price difference but now the demand is back.

United Cycles Parts And Manufacturers Association (UCPMA) President Gurmeet Singh Kular said, “Small-scale units have now started getting more orders. This has given a boost to the bicycle industry which was collapsing. But the price difference is still not more than Rs 200 per bicycle and for many models it is only Rs 100. So to protect the industry further, we want a safeguard duty to be imposed, which is done for a period of three years.”

Meanwhile, UCPMA has also hired an expert who will give it a report about the anti-dumping duty. UCPMA Joint Secretary Pardeep Wadhawan said, “We will even take up the matter with the Union Finance Ministry after the report is complete. We want the bicycle industry to get a further boost.”

The industry wants either the safeguard duty or the anti-dumping duty to be imposed on imported bicycles in order to widen the price difference. Kular said, “Although the customs duty on imported cycles has been raised, at the same time the excise duty on domestic production too has been increased. So the price difference has been reduced. Something more needs to be done.”

The rise in duty of a few of the imported bicycle models is as follows.

The duty on children’s models priced at Rs 1,250 has been hiked from Rs 190 to Rs 450 while that on the 24” bicycle priced at Rs 4,500 has been increased from Rs 675 to Rs 1,625.

The 26” models priced at Rs 7,500 now have a customs duty of Rs 2,700 against the pre-Budget figure of Rs 1,125. The customs duty on hi-end bicycles has been increased from Rs 2,000 to Rs 7,000.

By Ludhiana

Source: indianexpress.com