Exporters, industry pleased with sops in trade policy
Up against weak recovery in major markets, exporters and the industry on Monday welcomed incentives worth Rs 1,052 crore, stating the steps in the annual review of the Foreign Trade Policy will help India achieve the export target of $200 billion this fiscal.
In order to give immediate relief, a bonus incentive (over and above the present benefits) of 2 per cent has been announced by commerce and industry minister Anand Sharma to sectors like handicrafts, handloom, silk carpets, leather and leather manufacturers, sports goods, toys and select bicycle parts. The extra sops are 2 per cent of the export value.
"We are happy that the sectors which were not doing well have been considered. Extension of the Duty Entitlement Pass Book (DEPB) Scheme and interest subvention are welcome," president of the Federation of Indian Export Organisations (FIEO) A Sakthivel said. However, extension of DEPB up to June 30, is for the last time.
In the annual supplement of the 2009-2014 FTP, the government on Monday extended fiscal incentives worth Rs 1,052 crore to exporters, particularly for the labour-intensive textile, handicrafts and leather sectors, to make them competitive in the markets of the developed nations witnessing a weak recovery after the 2008 recession.
FICCI president Rajan Bharti Mittal said, "I hope with all these incentives we should be able to achieve the target of $200 billion.” However, given the uneven recovery in the world economy, export performance needs to be closely monitored, he said.
While the country's merchandise exports have grown by 31 per cent in the first quarter, $178.6 billion shipments in 2009-10 showed 3.5 per cent decline over the previous fiscal because of the global economic woes.
"Special focus to the labour-intensive sectors is most welcome. The focus on reducing transaction is very critical and therefore a laudable step," CII director general Chandrajeet Banerjee said.
The leather exporters are particularly pleased with the policy review. "Commerce and industry minister Anand Sharma stepped in at the time when it needed the most. A very positive step towards inclusive growth," chairman of the Council for Leather Exports Habib Hussain, said.
Sharma said that the country is on course to achieving $200 billion export target for 2010-11. During April-July 2010-11, exports grew by 30.1 per cent to $68.63 billion. In the last fiscal, India's exports were at $182 billion.
Also, interest subvention of 2 per cent has been extended to textiles, jute, leather and engineering goods sectors, Sharma said. Currently, the scheme is for sectors like handicrafts, handlooms, carpets and small and medium enterprises. The scheme is to expire on March 31, 2011.
Under the scheme, banks provide loans at a rate lower by 2 per cent than the market rate. "A bonus incentive scheme is being introduced for those sectors whose exports are not doing well.
This specially covers labour intensive sectors like handicrafts, handlooms, leather and leather manufacturers, carpets, sports goods, toys and some bicycle parts," Sharma said.
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