Move to permit used-car imports criticised news
02 June 2008

Mumbai: Even though the Indian government took a tough stand against the liberalisation of trade in re-manufactured goods at the World Trade Organisation (WTO), it is now trying to get the industry to get the industry to give up its opposition to the import of ''re-manufactured'' goods.

However, the Indian industry is of the view that re-manufactured goods are actually cheap second-hand goods masquerading under a so-called respectable banner of having been 're-manufactured'.

Most industry bodies are opposed to the import of second hand goods, saying that they will adversely impact domestic manufacturing.

Coording to reports, some government sources acknowledge that the recent inclusion of re-manufactured goods in the non-agricultural market access (NAMA) discussions has been done to appease some developed countries. Though they say that government will opposed it, they are still optimistic that the Indian industry should rethink its stand on market access in re-manufactured goods.

High up on the list of re-manufactured goods is the Indian automobile industry. Though other countries such as Afghanistan, Australia, New Zealand, Fiji and Sri Lanka have opened up their markets to remanufactured automobiles, India continues to oppose the move.

The Society of Indian Automobile Manufacturers (SIAM) and the Auto Component Manufacturers Association (ACMA) are unified in their opposition, saying that permitting re-manufactured auto components into India could expedite the demise of the nascent Indian automotive industry.

Automobile industry sources say that this export of second hand cars by developed nations under the garb of re-manufactured goods is actually a way to jettison polluting vehicles from their markets into other, less developed economies.

Sources say that for example, Japan levies prohibitive pollution taxes on passenger cars which are older than three years. So, by exporting these cars as re-manufactured vehicles at attractive prices to economies such as Sri Lanka or Fiji, Japan successfully transfers its costs of pollution to another country, leveraging the fact that environmental standards in these countries are not as high as that of Japan.

Pro-NAMA sources however say re-manufactured goods are ''as good as new'', and can be had for half the price of new ones. They say re-manufacturing is actually a process that brings back a used component to its original performance level.

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Move to permit used-car imports criticised