Closer India-EU ties will reinforce Renault’s decision to invest in both regions

CHENNAI/PARIS: Closer trade ties between India and the European Union will reinforce French carmaker Renault’s decision to invest in both regions, chief growth officer Fabrice Cambolive said on Tuesday, hours before the two sides finalised a landmark free trade deal.

Under the deal, tariffs on cars imported from the EU will be slashed immediately to about 30-35% from as high as 110% and then reduced to 10% over time. While the immediate effect is still being assessed, it is expected to benefit European carmakers like Renault, Volkswagen, Mercedes-Benz and BMW over time.

“Strategically, it shows the direction and this capacity to work closer between Europe and India is for us, a good news, because we are a company which has bet on these two continents on a very high level,” Cambolive told Reuters in the southern Indian city of Chennai.

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“It will reinforce our willingness to invest on both continents because we are kind of Indian and European company,” he added.

Apart from cars, tariffs on imported car parts from Europe will be abolished after five to 10 years, making it easier for companies to streamline supply chains as well.

Cambolive said while it is important to be able to export from Europe to India, it is also important to see what role India can play in the development of the European automotive industry in terms of parts and cars.

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“India was perhaps not in the top one priority (for Renault) in the last four years, but will become because of this getting closer strategy, the strength of our people there, the potential of market growth, and of course, the FTA,” he added.

On Monday, Renault relaunched its most popular nameplate in India, the Duster SUV, leaning on the world’s third-largest car market for growth outside Europe.