Nashik: MP Rajabhau (Parag) Prakash Waje has expressed serious concerns regarding the proposed implementation of the India-European Union (EU) Free Trade Agreement. He has sent separate letters to Union Finance Minister Nirmala Sitharaman, External Affairs Minister S. Jaishankar, Minister of Commerce and Industry Piyush Goyal and the EAM (Ministry of External Affairs), detailing the potential economic damage to Nashik's wine and automobile industries. Similar questions have been raised by the MP in parliament under Rule 377.
In his letters, MP Waje stated that the India-EU Free Trade Agreement will reduce import duties on European wines and automobiles. This will directly impact Nashik, a major wine production and automobile manufacturing hub in the country. The cheaper import of European wines and cars will lead to intense competition for local producers. This is likely to cause significant financial losses to local producers, grape farmers, factory workers, and related small and medium enterprises (MSMEs).
The MPs have requested the announcement of a special protection and transition plan due to the disproportionate impact on Nashik. These letters reflect the concerns among producers, farmers, and workers in Nashik's wine and auto industries. The demand for protecting local industries in the final form of the agreement is gaining momentum.
Impact on Nashik's Economy
Nashik is a major wine production centre in the country, and its wine ecosystem includes grape farmers, farm labourers, processing units, logistics, tourism, and the hotel industry. The automobile and auto components sector also employs thousands of skilled and semi-skilled workers. The MP noted that both these sectors are threatened by European imports.
A blow to 'Make in India'?
The MP questioned, "While 'Make in India' is a national priority, how will domestic production be protected if imports are increased to accommodate Western markets?" Furthermore, surplus goods from the European market could be dumped in India at lower prices through under-invoicing, thereby undercutting Indian manufacturers. Indian producers already face high taxes, compliance costs, and financing expenses.
Suggestions for Reforms and Protection
The MPs have demanded that a special protection and transition plan for Nashik be announced before the agreement's implementation. This includes the following suggestions:
- An incentive scheme linked to the PLI (Production Linked Incentive) scheme for the wine and automobile sectors.
- Subsidies for technological upgrades and grants for intellectual property rights (IPR) and advanced technology licensing.
- Targeted tax concessions and electricity tariff concessions during the transition period.
- An advanced land lease policy for grape cultivation and SEZ-like status for integrated production-storage zones for vineyard-related storage and processing infrastructure.
