Auto firms may get to use China motors, retain sops

Centre asks auto testing agencies on feasibility of relaxing localization norms

- Manas Pimpalkhare & Ayaan Kartik

For automakers fretting about the potential loss of incentives if they import fully built motors to skirt China's magnet export curbs, relief may be at hand.

The Centre has asked testing agencies to check whether strict localization norms to claim incentives can be relaxed, three people aware of the development said. The heavy industries ministry has also asked these agencies to assess the likely impact of such a move, the people said on the condition of anonymity.

"The testing agencies have been asked to assess the potential impact on manufacturers and their localization, their domestic value addition (DVA). The Automotive Research Association of India (ARAI) will do the assessment to see if relaxations are necessary," one of the three people cited above said on the condition of anonymity. ARAI is an autonomous testing and certification agency set up by the automotive industry along with the government, and affiliated with the heavy industries ministry.