American cult bike brand Harley Davidson may finally hit the Indian roads. In an effort to ease import of all bikes with over 800cc engine capacity, the government has relaxed their testing norms. The director general of foreign trade (DGFT) has now allowed import of all such bikes which have been tested and approved (read homologated) by any certified agency from the European Union.
The earlier policy stated that all these tests needed to be carried only in the 'country of origin' of the product. As a result, Harley Davidson's 800cc and above bikes were required to be homologated in the US. Similarly, Honda, Suzuki and Yamaha bikes had to be homologated in Japan, where they are actually manufactured, in order to be road-worthy in India.
Many bike makers, including Harley Davidson, had been lobbying with the government to relax these homologation norms. Harley had been facing problems meeting Indian homologation norms, which had been the biggest impediment for imports to India. Now its US-made bikes can tag an EU homologation certificate to be sold in India.
The government's decision will also encourage other two-wheeler majors such as Honda, Yamaha and Suzuki to introduce their full range of high-powered products in India. Yamaha Motor India has already launched its two super bikes -1,000 cc YZF R1 and 1,680 cc MT01 - in India. These homologated and certified in India before the relaxed import policy was announced in April this year.
However, for other super bike makers such as Suzuki Motorcycle India (SMIL), which plans to launch its legendary 1300 cc Hayabusa and the 1600 cc B King sometime next year, the new policy will now expedite the launch.
SMIL vice-president (sales & marketing) Atul Gupta said, "It will help us immensely to introduce our bikes faster in India. As our current homologation certificates from Netherlands will be allowed here, we will get a big boost in this niche market."
The super bike manufacturers have also asked the government to reduce the current 110% duty on the import of such bikes to make the price competitive. "We cannot compete with high-duty structures which make our price very uncompetitive.
We will come only if the government moderates its duties to the international level," Harley's vice-president, government affairs, Timothy Hoelter, had said during his visit to India a few months ago. However, all such bikes will have to conform to the Euro III emission standards as announced in the original notification released in April.
Commerce and Industry Minister Kamal Nath has said that he will talk to Prime Minster Manmohan Singh for reduction of import duty on American cult bike Harley Davidson.
"There will be talks," Nath said when asked what he intended to do after his letter to Singh asking for import duty cut on Harley Davidson.
Nath, who was speaking on the sidelines of Sports Goods Export Promotion Council function here, has reportedly asked the Prime Minister to consider cutting levies imposed on imports of the bike with a view to send a positive political signal to the US administration.
Earlier in the year, the government had relaxed norms on the import of Euro III compliant motorcycles of 800 cc and above engine capacity in return for allowing export of Indian mangoes to the US.
Harley Davidson, however, is facing a unique problem in India. Only those products certified by an authorised national body are allowed to sell in India, but in the US there is no regulator which certifies automobile standards.
Under the current norms, imported bikes cost almost double the original price due to high import duty.
The relaxation of norms by the government was welcomed by many of the existing multinational two-wheeler makers, including Yamaha and Suzuki, which have announced plans to bring their high-end superbikes in the Indian market.
In fact, Yamaha has already introduced two of its superikes -- YZF R1 and MT01 -- priced at Rs 10.5 lakh (ex-showroom). Suzuki plans to launch its high-end sports bikes by April next year.