Government defers auto policy again

new delhi: the much-awaited auto policy, which was to have been taken up by the cabinet on wednesday, has been deferred again. "the prime minister had another engagement. so the auto policy was not taken up at wednesday''s meeting," highly-placed sources said here. sources said the policy envisages upto 100 per cent foreign direct investment through automatic approval in the auto and components sector along with a minimum investment requirement of 100 million us dollars for four wheelers and 25 million dollars for three wheelers. the policy also includes major incentives for research and development including an increase in the weighted tax deduction under the income tax act for in-house r&d and sponsored research. the current weighted tax deduction is 125 per cent which is sought to be raised under the policy. the policy also supports rebate in the applicable excise duty for every one per cent of the gross turnover of the company''s expenditure on r&d. sources said the policy would also encourage setting up of independent auto-design farms while reiterating government''s commitment in promoting lower emission fuel technology including use of cng and lpg. the policy lays down that the tariff would be fixed to facilitate development of more capacity without giving undue protection. regarding used vehicles, the policy lays down that the second-hand vehicles would have to meet the environmental requirement norms as laid down under the central motor vehicles regulations act.