‘We would welcome a cut in GST rate for electric and hybrid cars’

NEWDELHI: Japanese ambassador to India Kenji Hiramatsu has sought tax relief for hybrid and electric cars in the 2018 budget which he says would be an incentive for foreign auto makers. In an interview ahead of the arrival of an 80-member business delegation from the Japan Chamber of Commerce and Industry (JCCI), Hiramatsu also called for the easing of rules on external commercial borrowings which he said would boost infrastructure development, expected to be a key focus of the 2018 budget. Edited excerpts:

A delegation from JCCI is expected to visit Delhi. Could you give some details?

JCCI is the biggest chamber of commerce in Japan. It comprises 515 local chambers of commerce and members include big companies and small and medium enterprises (SMEs).

Japan’s economic success has been spurred by SMEs. JCCI is characterised by a strong presence of SMEs. So from here, an 80-member delegation is coming, from 21-24 January. The delegation is headed by chairperson Akio Nimura, the former head of Nippon Steel and Sumitomo Metal Corp.

The Japan-India relationship is growing very fast, so this (trade) mission is an important one. The visit follows from Prime Minister Shinzo Abe’s visit to India in September and is part of our ongoing efforts to bring more companies to India to invest, especially SMEs.

Which sectors do members of the delegation represent?

They represent automobile, retail, food processing, textiles, logistics, transportation and service industries. Interest in India is growing. So it is not only traditional sectors like automobile and steel but also wide ranging-areas which include retail and food, among others.

India has recently improved its position in the ease of doing business rankings. Practically, is it easier to do business in India now?

I welcome India’s ranking going up. I see the difference in the area of development of infrastructure, in terms of reform measures taken, in terms of reduction in administrative difficulties.

I also think many Japanese people have seen the difference, especially under PM (Narendra) Modi. But we hope to see more reform coming and more improvement in infrastructure.

What are the areas under taxation in which you would be looking at reliefs?

We hope there will be some more cuts in tax rates under GST. We are saying that with regard to automobile issues, we would welcome a reduction in the rate for electric cars, but we hope attention will be given to import of hybrid cars, too. If some tax incentive can be provided to hybrid cars, too. Also, we are hoping some measures on foreign currency restrictions including external commercial borrowings.