Mumbai: Apex engineering exporters body EEPC Monday said Finance Minister P Chidambaram's proposal to lower excise duty on cars and two-wheelers in the interim budget will boost the exports of key engineering goods.
"The cut in excise duty in certain manufacturing industries like cars and two-wheelers will help export of key engineering goods which are poised to become the top contributors to India's export basket," EEPC chairman Anupam Shah said in a statement here.
In a move to bring back growth in the domestic auto industry, the government has proposed to slash duty on SUVs from 30 percent to 24 percent, while in large and mid-segment cars it has been reduced from 27-24 percent to 24-20 percent.
Excise duty on small cars, motorcycles and commercial vehicles has been cut from 12 to 8 percent and appropriate cuts are to be done on chassis and trailers.
The employment-oriented engineering sector, which encompasses a large number of MSMEs, would be contributing around USD 65 billion to the overall export shipments of USD 326 billion, as targeted by the government, Shah said.
"However, to achieve this target and to improve upon the same, the manufacturing sector needs a big push from the government to sharpen India's competitive edge in the global market," he said.
The government has projected a 6.3 percent growth in merchandise exports in the current fiscal despite headwinds in the global market.
The country's merchandise exports logged a negative growth of 1.8 percent to reach USD 300.4 billion in FY13 over the previous year, Shah said adding, "But we are seeing a definite turnaround in the ongoing fiscal."
