Tata Motors sells Nano at an expensive price in Sri Lanka

Tata Motors on Sunday began selling the world's cheapest car, the Nano, in Sri Lanka at a price tag nearly three times higher than the cost in the Indian market.

Diesel and Motor Engineering (Dimo), the local agent for Tata, said they began accepting bookings for the Nano with a price tag of 925,000 Sri Lankan rupees ($8,486) for a basic stripped down version.

"We are getting good enquiries. Those who pay Rs100,000 today can have the car in two weeks after making the full payment," a company spokesperson said.

He said the car was available in red, yellow, blue, white and silver and the higher-end model with air conditioning will cost Rs1.1 million, just Rs40,000 (Rs18,000)less than the 800-cc Maruti's price in Sri Lanka.

Maruti is the market leader in small cars in Sri Lanka.

The price of a Nano in Sri Lanka is far higher than what it is in India, where the basic model costs just under $3,000, because of high import duties and local sales tax, a company official said.

However, he said he was hopeful of selling the first consignment of 500 Nano cars that have already arrived in the island.

Sri Lanka slashed car duties in June last year, but raised them again in April this year after a heavy drain of foreign exchange to import cars.

The Colombo port was seeing 500 cars unloaded each day in recent months before the duty was raised again in April.