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Minister grilled for falling car exports

Minister of State for Commerce B B Ramaiah had to face a tough time in the Lok Sabha on Friday on the government's failure to pull up foreign tie-up car manufacturers who had failed to honour their export commitments.

A visibly embarrassed minister promised to call a meeting of the six manufacturers concerned and threatened to hold back further licences to these firms.

Ramaiah did not have a straight answer to Prakash Vishwanath Paranjpe who wanted to know the reasons for the government going soft on the export commitments made by these manufacturing at the time of clearing their production proposal.

The minister pointed out that the DCM Daewoo had committed to export its Indian manufactured cars and earn foreign exchange worth 14 million dollars in 1995-96 and 19 million dollars in 1996-97. Similar commitments for PAL-Peugeot was 11 million dollars and 33 million dollars for the two years. They failed to earn even one dollar from car exports.

The Mercedes Benz, however, earned 1.2 million Deutsche marks from exports in 1996-97 even though they had not put forward any export commitment.

Ramaiah said the export commitment made by these joint venture manufacturers was not an export obligations even though it was a factor that helped to clear their project proposal.

He said these car manufacturers were importing CKD/SKD kits for assembly in India and hoped they would start exporting cars. He added that the increased component of indigenisation agreed to was 50 per cent in the third year and 75 per cent in the fifth year.

The minister said that the government could not act tough with them for non-fulfilment of the export commitment as they did not seek any import duty concession while bringing in the component kits.

UNI