Govt may rationalise customs duties to push local manufacturing

The government is considering proposals to rationalise customs duties on almost 50 products in an attempt aimed at boosting local manufacturing by removing duty inversions.

caused by some recent free trade agreements in a move that could also cool commodity prices and check dumping of Chinese goods, two officials familiar with the matter said.

Several Indian manufacturers are facing duty anomalies because of free trade agreements (FTAS), and hence duty inversions need to be corrected so that local products can compete with imported items, they added, requesting anonymity. FTAs give zero-duty market access to foreign goods, but shipment of their inputs and components (required for value addition by local manufacturers) continue to attract higher duties, making India-made products uncompetitive.