Harley Davidson – USA;
H-D is a US-based motorbike manufacturer formed in 1903 in Wisconsin. It is known for a style of customization that gave rise to chopper bike style and comes under luxurious bikes.
- Harley Davidson is no more in India due to the loss face by the United States of America ( founder of H-D ).
- According to America, the Indian government is not taking interest in Harley Davidson’s market and apply more tariff on it.
- US’s President said, ” India is a tariff king country ” because it decreases the market of US-based companies in its own territory.
|Tariff; It is a tax imposed on goods and services that are imported from foreign countries.|
After Toyota decides to halt India expansion, now Harley-Davidson decides to exit the Indian market. The BJP govt's apathy is forcing automobile manufacturers to exit the market. Thanks to punitive taxation, Foreigner Investors are leaving India in droves!
— Shama Mohamed (@drshamamohd) September 24, 2020
— Mint (@livemint) September 24, 2020
Here the Top 2 reasons why Harley Davidson leaving India?
The iconic US bike brand is stopping manufacturing and extremely getting back its sales aspects from India due to the following reasons as below;
High Tariff by India;
As we know that the tax imposed on foreign goods and services when they imported in India is called a tariff. And India applies at least 95% tariff on Harley Davidson bike which would be sold in India at the starting rate of Rs 4.65 lakh.
Initially, the demand of Harley Davidson in India was too much, but with the passage of time when Indian government did not start to decrease the tariff on US’s Harley Davidson then Indians started to refuse to buy Harley, which has created a great loss to the US market in India.
Impact on India after exiting Harley’s Market Operations;
The stylish Harley Davidson leaving India and will create few loss to India as well in terms of GDP and employment.
As we know that GDP ( Gross Domestic Products ) means the goods and services produced within the country, whether the employees or companies belong to foreign but when it produces manufacturing and services in a particular country then it is considered as a GDP of that particular country.
|Point to be noted;|
Harley Davidson is a US-based company and was also working in India for marketing and now it is leaving India. It will create a loss in India’s GDP.
Decrease in Employment;
Both Indians and Americans were working in Harley Davidson in India, but right now these employees will lose their jobs from H-D companies. This is also a critical disadvantage to India after Harley’s exit from India.
Options For India;
- India should have to lower the tariffs because to increase the GDP under ” Make in India “, foreign companies and the Swadeshi companies will play a crucial role in it.
- Foreign companies in India also create employment for Indians to enhances the service sector, which is also contributed to the economy.
- Trade and investments also create a positive environment and enhance relations with each other.
India-US Deal 2007 in terms of investments a trade;
In 2007, India and the US signed an agreement where Indian mangoes would get access to American markets in return for Harley Davidson’s entry into the Indian Market.
Harley Davidson entered India in 2009 after an agreement between Washington and New Delhi that allowed American motorcycles to access the Indian market in exchange for Indian mangoes exports to the United States.
In a swap deal, India had sent its freight of mouth-watering mangoes to the United States while allowing the importation of Harley Davidson bikes with an engine capacity of 800 ccs or above if they comply with Euro-3 emission norms.
Mango Export to the US;
India exported 617.42 metric tonnes of Alphonso Mangoes (High-Quality Mangoes ) to the United States in 2016-17, from nil in 2007-08. However, this is nowhere close to the 3,000 tonnes that were exported to the UK at the same time. During 2015-17, India exported a total of 52,000 tonnes of mangoes valued at Rs 450 crore.
|Points to be noted;|
Now, Harley Davidson is pulling out of India, another major setback to Prime Minister Narendra Modi’s efforts to lure or retain foreign manufacturers in the midst of the nation’s worst economic downturn in decades.
US’s President’s statements on High Taxes and Tariffs;
President Donald Trump brings up the high import duty in India on the Harley-Davidson motorcycles as an example of unfair trade. https://t.co/WzG9gyGCBp
— The Hindu (@the_hindu) February 14, 2018
The US President Donald J Trump often cited the Narendra Modi- led government’s tariffs on Harley Davidson as an example of Why India is a ” Tariff King “. India did lower duties on the Milwaukee, Wisconsin based bike maker to 50% in 2018 from around 95% earlier, but the US President Donald Trump found the new tariff rate ” still unacceptable “.
According to our Analysis, we have concluded that the exit of Harley Davidson will create loss to India at some points like in employment, GDP and relations between India and the United States. While on the other side, Harley Davidson can shift to China, which will be a sign of negative impression for India. So, we think India should decrease tariffs on such things.