04 March 2008 14:53 [Source: ICIS news]
MUMBAI (ICIS news)--Indian Chemicals and Fertilizers Minister Ram Vilas Paswan will urge the government to reverse the proposal to remove the duty exemption on naphtha for polymer production, he said on Tuesday.
Finance minister Palaniappan Chidambaram levied a 5% customs duty on naphtha imports in his budget presentation for the 2008-2009 fiscal year. However, naphtha imported for manufacturing fertilisers would continue to be exempt from this duty.
"The department [chemicals and fertilizers] had suggested [to the Finance Ministry] that there should be no import duty levied on naphtha," Paswan said on the sidelines of the International Petrochem Conference.
"I will personally write to the prime minister and finance minister to reverse it [customs duty]," Paswan said.
Reacting to the budget, Indian polymer producers had earlier told ICIS news that their margins would be hit by the decision.
"We are very disappointed that the government has removed the exemption, as it will increase our production costs," a source had said.
The 5% naphtha tariff was withdrawn two years ago to boost polymer production and demand.
The two-day conference, organised by the Confederation of Indian Industry (CII), will conclude on 5 March.
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