The Hindu Business Line : Norms for minor forest products export soon

THE Office of the Director General of Foreign Trade (DGFT), under the Ministry of Commerce, is now in detailed discussions with the Agriculture Ministry over the much-awaited rules of the "Vishesh Krishi Upaj Yojana". The programme was announced in the new Foreign Trade Policy unveiled by the Commerce Minister, Mr Kamal Nath, on August 31.

Under the scheme, which also covers all minor forest produce, duty exemption scrips would be given to all eligible exporters of agri-commodities. The rules are expected to be finalised soon.

Responding to anxious queries by exporters over the unusual delay in announcing the rules at an interactive session organised by the Federation of Indian Export Organisations (FIEO) here on Tuesday, Mr K.T. Chacko, Director-General of Foreign Trade, said since the scheme involved benefits of duty credit, the Agriculture Ministry did not want unfettered imports of agri-products which could seriously affect the livelihood of our marginal farmers. DGFT has already carried out two rounds of discussions with the Ministry, he said.

He clarified that the main delay over the rules was over the critical issue of what should be allowed in and what should be exported. He said the main plank of the new FTP, as different from the earlier Exim Policy, was the achieving of "inclusive growth", under which all marginalised sections of our society would stand to benefit through creation of additional employment.

Urging exporters to move away from incentives to an era of intense competition on a global scale, Mr Chacko said the Government was fully seized of all issues faced by exporters, mainly on the infrastructure front. Mr Chacko said steps are being taken for solutions, particularly in the short-term.

Describing the FTP as an evolving one, he said it would be subject to further fine-tuning by early next year. ``We should not rest with just $60-65 billion of annual exports, as the objective was to extend our share in world trade to at least 1.5 per cent by 2009, and all the constraints faced by exporters would be looked into,'' he pointed out.

The DGFT has already set up a special cell within the department to study the impediments of Indian exports.

Earlier, speaking at a session organised by CII, Eastern Reion, the DGFT urged CII to prepare a study on the alternative to DEPB scheme, which was equally beneficial.

According to Mr S.K. Jain, Regional Chairman of FIEO, taxation of DEPB licences continues to be a debatable issue among exporters, as the Income Tax Department has re-opened the assessments of past years of exporters for levying tax on profits over sale of DEPB licences.

According to the I-T Department, such profits were not strictly export-related income. Mr Jain felt this would adversely affect many small and medium exporters.