The Federation of Indian Export Organisations (FIEO) today welcomed the government’s move to rationalise duty drawback rates to boost shipments but asked for a review of the rates related to the electronic sector.
“By and large drawback rates are on expected lines as generally the decline is in the range of 0.1 per cent to 0.5 per cent with few exceptions,” FIEO President Rafeeque Ahmed said in a statement.
He expressed concern over the sharp decline in drawback rates for electronic sectors.
“...the rates for coloured and black & white televisions have been slashed from 4 per cent to 1 per cent and public address systems from 2 per cent to 1 per cent.
“Since only recently we introduced new electronic hardware policy with a view to encourage hardware manufacturing in India to reduce electronics imports, which may cross over $ 200 billion in next 5-7 years, the rate for the sector may be reviewed looking at broad objectives,” Ahmed said.
Duty drawback rates for black & white TVs is at 1 per cent (from 4 per cent), public address systems/loudspeakers 1 per cent (2 per cent), quartz watches 3 per cent (4 per cent), FIEO said.
Government yesterday rationalised the duty drawback and brought more items under the scheme for tax refund to exporters to give a boost to overseas shipments.
The revised All Industry Rates of duty drawback, which have been notified, will come into effect from September 21.
The exporters’ body also welcomed the increase in rates for silk garments, fabrics and yarn, gold and silver jewellery and also bringing milk products under drawback as exports growth in dairy sector has been encouraging.
Among others, the rates are silk 7.8 per cent (from 7 per cent), leather shoes 9.1 per cent (9.2 per cent), leather sandals 8.1 per cent (8.2 per cent), sports shoes 3 per cent (4 per cent), tractors 1.7 per cent (2 per cent), car components 7.2 per cent (7.5 per cent), FIEO said.
The government had taken into account the recommendations of the committee headed by Planning Commission Member Saumitra Chaudhuri. He is also Member of the Prime Minister’s Economic Advisory Council.
India’s exports rose to a two year high of 13 per cent in August on account of improved global situation.