India unhappy over Sri Lanka's car import tariff hike

Bernama (New Delhi) - India on Tuesday raised with Sri Lanka its substantial rise in import tariff on automobiles, Press Trust of India (PTI) reported.

"We have raised the issue in Colombo today through our mission. We will be raising it with the Sri Lankan Finance Secretary who will be coming here shortly," a spokesperson from the Indian Ministry of External Affairs said.

The issue was raised a day after the Commerce Ministry expressed concern over the tariff increase and said India would take the matter up with Sri Lanka.

"Sri Lanka is a very important market as far as cars and commercial vehicles are concerned. We are concerned about it. We believe the import tariff hike in Sri Lanka is going to adversely affect our car exports to that country," said Additional Secretary in the Commerce Ministry, Rajeev Kher.

Sri Lanka has recently increased import duties on vehicles by almost 100 per cent, which has adversely impacted exports from India.

"Last year, India exported vehicles worth US$6 billion out of which automobiles worth US$800 million were sold in the Sri Lankan market. Now this has almost gone," said Society of Indian Automobile Manufacturers director- general Vishnu Mathur.

The increase in duties have affected exports of small cars, two wheelers and three-wheelers from India.

Sri Lanka increased duties on sports utility vehicles about two weeks ago.