Ford said it would increase the prices of its cars in India as a result of a hike in excise duty announced in the country’s federal budget last week.

Ford of India president Michael Boneham said: “The announcement of a 2% increase in excise duty is disappointing and not favourable towards the auto industry. This will lead to increases in prices of our products and will have a negative impact on consumer confidence.”

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India’s finance minister Pranab Mukherjee said on Friday that excise duty on cars currently taxed at 22% would increase to 24%.

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