When the automobile industry began the current fiscal year with a positive show last month, the proposed plan to impose safeguard duties on auto components threatens to spoil the party.
The industry posted an overall 10.8 per cent growth in April, largely by two wheelers that grew by 13.7 per cent.
Passenger vehicle segment also posted a 4.4 per cent growth as a host of new launches, including Mahindra Xylo, Maruti A Star, Fiat Linea, Hyundai i10 and Toyota Innova helped to revive sales.
Safeguard duties are under consideration on a host of components like steering knuckles, front axle beams, crankshafts and even hot rolled coil steel.
Dilip Chenoy, director general, Society of Indian Automobile Manufacturers (SIAM) said safeguard and anti dumping duties if imposed will create problems. “A balance has to be struck,” he said.