The Hindu Business Line : Curtailment of benefits: Exporters to approach Minister, PMO

Exporters are agitated over the Government's move to curtail, on a retrospective basis, the benefits granted under the Target Plus scheme for exports effected between April 1, 2005 and March 31, 2006.

They have now decided to make representations to the Commerce Minister, Mr Kamal Nath, and also the Prime Minister's Office (PMO) seeking the rollback of this move.

Target Plus is an export promotion scheme in which the benefits are linked to the incremental growth in exports achieved during a licensing year.

The benefits are in the form of duty credit scrips that are not transferable.

This scheme was introduced in April 2005. It was, however, removed from April 1, 2006, by this year's annual supplement to the foreign trade policy.

`Not a fair move'

"The move to curtail benefits and that too on a retrospective basis is not at all fair. After announcing the policy and allowing it for a year, the Government has changed the terms of the scheme on a retrospective basis. It raises credibility issues," a trade policy expert said.

The Government had, on June 12, cut the entitlement on exports made from April 1, 2005 to March 31, 2006 under the Target Plus Scheme to a uniform 5 per cent of the incremental growth achieved.

The Directorate-General of Foreign Trade (DGFT) has, through an executive order on June 12, done away with the 10 per cent and 15 per cent entitlement slabs.

Industry sources indicated that the Government would save at least Rs 1,500 crore from this move.

The DGFT's move to curtail the benefits may have been prompted by the revenue department, which was keen to limit the benefits granted under this scheme.