Monday, March 27, 2023
By Kamal Swami
Some Car Manufacturers Misused FTA Costing: Piyush Goyal
Addressing the Asia Economic Dialogue, Union Minister of Commerce and Industry, Piyush Goyal said that the Indian government has to face the loss of billions of dollars due to misuse of the Free Trade Agreement (FTA) by two of the South Korean auto manufacturers. In the words of the minister taking advantage of FTA terms and conditions two South Korean companies Hyundai and Kia imported car components from their native manufacturers and other manufacturers resulting in a trade deficit of billions of dollars to India.
In his words, “ The Korean auto industry, specifically Hyundai and Kia, are clearly two of the laggards. They have enjoyed the benefits of our free-trade agreement with Korea and Japan and continue to import indiscriminately”. He also added that these companies are inspired by the strong feeling of nationalism which drives them to buy raw materials from native suppliers rather than the country they operate their operations.
The minister of commerce and industry said, that despite high prices these companies prefer to buy raw materials for their cars from manufacturers in their country. Anyhow, it would be interesting to know that despite this statement from the Union Minister, both these companies have neither broken any rule or law nor engaged in any such activity which makes them culprits for importing raw materials from their manufacturers. Additionally, the minister did not mention the significant earnings in US dollars from export duties that these two car manufacturers have brought to India's foreign exchange reserves.
