'India ready to slash luxury goods duties'
Minister Kamal Nath, at the Hindustan Times Luxury summit, says India aims to boost the use of Indian materials by global labels.business Updated: Mar 30, 2007 23:50 IST
India is ready to cut import duties on luxury goods from overseas, but also wants to guard local manufacturers from unfair competition while aiming to boost the use of Indian materials by global labels in the field, Commerce and Industry Minister Kamal Nath said on Friday.
"We don’t want China to do to us what they did to you," he joked to his French counterpart Christine Lagarde as he kicked off the second Hindustan TimesMint Luxury Conference, where a hundreds of delegates including the heads of some of France’s legendary style companies met up with Indian partners and business prospects.
Nath suggested that luxury goods, many of which carry a 35 per cent import duty that makes it easier for rich customers to shop for them on their overseas trips, could follow the principle being adopted to tax wines, in which the costlier labels attract lower duties.
The minister, locked in a friendly duel with the French minister to boost bilateral trade on the one hand but defend and protect Indian interests on the other, said Indian households with an annual income of more than $100,000 numbered two million and were growing at 14 per cent a year, but the country also had 300 million people surviving on less than one US dollar a day.
Seeking a way out of the "great paradox," Nath said India offered strong intellectual property protection and a 25-million strong domestic market to foreign firms, who must step up sourcing to India. He told reporters that Indian leather and handloom items were among those that become part of high-end luxury items.
He also called for Indian luxury brands to take on the world.
"I am sure they are getting bored of French and Italian luxury brands," he joked.
"There is enough compost to create luxury goods markets in both countries," Lagarde told a joint news conference. She said France can offer expertise to Indian jewellers and designers in guarding intellectual property in a field where fakes and cheaper copycat versions are increasingly common.
She told delegates, who included marketers, retailers and real estate firms in addition to luxury goods makers, that she had been given special permission by her government to visit India in view of its significance as a market, despite the proximity of elections.
Heavyweights from Comite Colbert, France’s 68-member elite club of luxury goods makers including legendary names such as Coco Chanel and Louis Vuitton, are part of the conference that marks India’s emergence as a luxury centre. Comite Colbert members are part of a task force assigned to boost luxury trade.
Shobhana Bhartia, vice-chairperson of Hindustan Times Group, told delegates that the number of India’s middle class households had grown to 17.3 million in 2005 from 4.5 million a decade ago, offering a growing modern market, while traditional artisans and craftsmen were an inspiring source of supplies for overseas labels.
"Just as you have a lot to offer India, India also has a lot to offer to the world," she said.