The Hindu Business Line : Exporters await word on trade policy supplement

New Delhi, March 30 Exporters keep their fingers crossed as the Commerce Ministry is set to unveil the annual supplement to the Foreign Trade Policy (FTP) on April 7 and with the uncertainty over the continuation of the duty entitlement passbook (DEPB) scheme beyond March 31, 2008, having ended for the time being.

Sources in the Government told Business Line that no decision on its continuation could be taken at the Cabinet meet on March 27, and they said the scheme could be in place till it is merged with the duty drawback scheme. The catch is that under the DEPB schedule there are as many as 2,200 items which need to be subsumed in the drawback schedule, while the latter has only 1,300 DEPB items that fit into its schedule.

Replacement scheme

They say the revenue department is working out ways to match the leftover 900 DEPB items into the drawback schedule and this exercise would take at least another three months, and till then the exporters availing themselves of these benefits could breathe easy. As the replacement scheme to DEPB providing for reimbursement of State levies such as octroi, mandi tax, electricity duty suffered by exporters could not be hammered out, with the States unwilling to shoulder the burden, the merger of DEPB with the drawback scheme has been in the making for quite some time.

Asked about likely measures the Government would put in place to provide some relief to exporters reeling under rupee appreciation, which has hit their margins implacably, the sources conceded that the Union Budget 2008-09 has by and large bypassed the serious concerns of exporters and, as such, the policy modifications need to provide some mitigating measures to address their woes. Hence, in schemes like export promotion of capital goods (EPCG), where more than 75 per cent of the total production is exported, the exporter could be eligible for EPCG scheme without any rider on average export obligation. Alongside, measures are also mooted to incentivise exporters under Focus Product and Focus Market schemes by increasing the extant level of marketing assistance.

Sector-specific relief

There would be sector-specific relief for export of floriculture and leather products in view of the high-value and lucrative overseas market in the case of the former and the labour-intensive nature of the leather sector, which has sustained severe employment loss due to rupee appreciation.

Alongside, efforts would be made to include additional items such as cotton, jute and coir under Vishesh Krishi and Gram Udyog Yojana to provide benefits to growers and exporters of important commercial crops. The sources said the authorities are also studying the feasibility of making freely transferable the duty credit scrips under all reward schemes with a Common Import List.

More Stories on : Exports & Imports | Policy

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page