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Import of foreign cars, two-wheelers to become easier with new DGFT norms

This could also allow electric car manufacturers to test the waters in India before considering local assembly.

In its latest policy, the Ministry of Road Transport and Highways will reportedly remove the roadblocks for import of foreign cars and motorcycles to India. As per a report published on the Times of India, with changed norms, automobile manufacturers or their representatives can now import foreign-made vehicles irrespective of their price and engine capacity.

Each manufacturer will be allowed to annually import 2,500 units of foreign-made cars or two-wheelers, which comply with international regulations.

Talking about the Director General Of Foreign Trade (DGFT) norms, an official from the ministry told TOI, “The DGFT norm is based on the Central Motor Vehicle Rules so far as registration without local testing is concerned. So, the change in the rules will pave the way for liberal import norms.”

Existing DGFT norms

The existing norms related to importing foreign vehicles are quite strict. Currently, automobile manufacturers or their representatives are only allowed homologation-free import of cars that are valued above $40,000, which is around ₹ 28.7 lakh, as per current exchange rates.

In case of two-wheelers, manufacturers are only allowed to import vehicles with engine capacity above 800 cc.

An official announcement is still awaited from the Ministry, but this change in norms can open up new avenues for manufacturers across all segments, for bringing in a host of global models to India. This could also allow electric car manufacturers to test the waters in India before considering local assembly.

New DGFT norms

  • The new norms will allow each company to import only up to 2,500 units annually of a car or a two-wheeler complying with internationally accepted standards. Companies are also allowed to import up to 500 other vehicles each such as buses and trucks.
  • The imported vehicles will have to have “right-hand steering control” to meet Indian norms.
  • All these vehicles will attract import and other duties as applicable.
  • Notifying the norms for the registration of imported vehicles, the ministry has said those compliant with international standards set by the testing agencies in Europe, Japan and some other countries will be allowed to be registered in India.

“The DGFT norm is based on the Central Motor Vehicles Rules so far as registration without local testing is concerned. So, the change in the rules will pave the way for liberal import norms,” said a ministry official.

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