Seven firms now in automotive assembly here: Rishad

Monday, 30 December 2013 01:06 - - {{hitsCtrl.values.hits}}

Cess on rare earth imposed to safeguard domestic industries
Rishard tells Parliament good utilisation of Industry and Commerce Budget allocations

Export cess on rare earth/mineral sand were introduced to safeguard our industries and no less than seven firms are now active in automotive assembly industry in Sri Lanka. “To safeguard domestic industries and to ensure a continuous supply of raw materials for local industries, we introduced exports cess on selected items. Seven companies have ventured into the automobile assembly industry with a local value addition exceeding 30%”

said Rishad Bathiudeen, Minister of Industry and Commerce on 10 December. Minister Bathiudeen was making his Ministry’s Budget Statement in Parliament, which was tabled by him. Safeguarding domestic industries Elaborating on the introduction of measures to safeguard domestic industries and on local automotive assembly, Minister Bathiudeen said: “Taking into consideration the requests made by the division on behalf of industrialists, the cess on several items was increased/imposed, such as fresh, preserved, dried vegetables and fruits/other vegetable and fruit products (to protect the local processed food industry), edible oils, margarine, sausage or preserved meat products, honey and jaggery, confectionaries, bakery products, food preparations, mineral water, vinegar, salt, among others. In order to safeguard domestic industries to ensure a continuous supply of raw materials for local industries and to encourage the export of value added goods by discouraging the export of items in raw form, the cess on cinnamon, cloves, natural sands, quartz, clay, phosphate stones (emery, corundum), stones (gravel, pebbles, etc.), mica, steatite, ilmanite, rutile, titanium, zirconium, niobium, tantalum, vanadium, etc. was increased, to facilitate domestic industries. Also exempted from the payment of excise duty of locally assembled/manufactured motor vehicles and electrical items that come under the HS headings 84 and 85, which achieve a Local Value

Addition (LVA) of above 30%. From the time that the first batch of vehicles was granted the duty exemption in 2008, seven companies have ventured into the automobile assembly industry with 17 models of vehicles being assembled by the seven local companies totalling to over 6,000 vehicles with a LVA exceeding 30%.” Addressing the House on his Ministry’s utilisation rates, Minister Bathiudeen said: “I am pleased to say that our actual recurrent expenditure up to 30 September 2013 stood at Rs. 374.92 million, which is an utilisation rate of 66%. Our capital expenditure up to 30 September 2013 stood at Rs. 518.6 million, which is an utilisation rate of 31%. The grand total actual expenditure of both recurrent and capital is Rs. 893.5 million up to 30 September 2013. “These funds were fruitfully utilised by my Ministry’s committed divisions, departments, funds and projects – among them are the Industrial Policy & Development Division, Regional Industrial Development Division, Development Divisions 1, 2,and 3, the Productivity Improvement, Industry Registration and Management Information Division, National Authority for the Implementation of Chemical Weapons Convention, Corporations & Statutory Boards Division and organisations under it, Small and Micro Industries Leader and Entrepreneur Promotion Project III Revolving Fund (SMILE III Revolving Fund), Textile Industry Development Division, Department of Textile Industries (DTI), the Department of Commerce (DOC), Department of Registrar of Companies, National Intellectual Property Office, and the Sri Lanka Export Development Board.”