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Business News/ Industry / Manufacturing/  Nissan seeks improved tax laws,  infrastructure
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Nissan seeks improved tax laws,  infrastructure

The cost of raw materials, power and labour must be competitive for the govt's Make in India campaign to succeed, Nissan's Guillaume Sicard says

For Nissan, India is a key hub for export of completely built units and auto parts supply. Premium
For Nissan, India is a key hub for export of completely built units and auto parts supply.

Chennai: Nissan Motor Co. Ltd’s Indian unit, which last year overtook Maruti Suzuki India Ltd as the largest car exporter from India, on Tuesday said India needs to improve its tax structure and infrastructure and keep costs low to attract foreign investment in manufacturing.

The cost of raw materials, power and labour must be competitive for the government’s Make in India campaign to succeed, Guillaume Sicard, president of Nissan’s India operations, said at a press briefing to mark the export of 500,000 cars from India by Nissan.

“If you want (to) push people to invest (in) India for the future, there should be simplicity in the tax structure and stability," he said. “Currently, the tax structure in India is complex and keeps changing."

That’s a complaint voiced by many foreign investors in India, following high-profile tax disputes involving companies such as Vodafone Group Plc and Royal Dutch Shell Plc.

Foreign portfolio investors are also battling the government over tax claims slapped on them for capital gains they made in the past.

Apart from simplifying the tax structure, India needs to reinforce its infrastructure and put in place a system of quick redressal of complaints by foreign companies to attract investment, said Sicard.

He said the administration should respect agreements that are entered into, calling it a “matter of trust and confidence".

“Infrastructure is not at the level we expected, but it has improved in the past five years," he said.

For Nissan, India is a key hub for both export of completely built units and for auto parts supply.

Nissan exports over 1,800 types of manufacturing parts to 34 factories across 24 countries. Nissan exported 118,000 units out of India in the financial year ended 31 March 2014, overtaking Maruti, to rank behind only Hyundai Motor India Ltd in overseas shipments of cars.

Nissan currently exports 65% of the cars it manufactures in India, but expects to increase its presence in the domestic market, Sicard said.

Currently, Nissan sells two brands in India—Datsun, which caters to the lower end of the price segment, and Nissan, in a slightly higher price bracket.

Sicard wants Nissan to feature among the top three brands in the market, which is currently led by Maruti Suzuki, Hyundai and Honda Cars India Ltd.

Awareness of Nissan products in the country is still low as it comes in at number six or seven in terms of brand recall among consumers, Sicard said.

This will improve with increasing penetration in the local market. Nissan aims to increase the number of sales outlets in India to 300 in 18 months from 175 at present.

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Published: 26 May 2015, 11:50 PM IST
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