Centre announces more sops to boost exports
India's exports dropped by 1.76 per cent at $300.60 billion in the financial year ended March 31, 2013. In...
New Delhi (IANS): In a bid to boost the export, the government on Thursday announced a host of incentives, including interest rate subsidy and liberalisation of norms for special economic zones (SEZs).
Announcing the measures as part of annual supplement (for 2013-14) to the Foreign Trade Policy 2009-14, Commerce and Industry Minister Anand Sharma said that the government has decided to extend the period and scope of interest rate subsidy provided under the zero duty Export Promotion Capital Goods (EPCG) scheme.
"We have decided not only to extend the zero duty EPCG scheme beyond March 2013, but also merge it with 3 percent EPCG scheme. Now the zero duty EPCG benefits will be available to all sectors," Sharma said. "We have also undertaken a major simplification of the EPCG scheme," he added.
The Foreign Trade Policy has two variants under the EPCG scheme -- zero duty for a few sectors and 3 percent duty for all sectors. Now the government has decided to harmonise zero duty EPCG and 3 percent EPCG scheme into one scheme which will be a zero duty EPCG scheme covering all sectors.
India's exports dropped by 1.76 per cent at $300.60 billion in the financial year ended March 31, 2013. In the previous financial year the exports had increased by more than 20 per cent. A The country's trade deficit widened to $190.91 billion in 2012-13 as compared to $183.4 billion recorded in the last fiscal. Sharma said interest subsidy and other incentives provided by the government would help revive exports growth and curb trade deficit.
"We are conscious of the need to enhance exports so that we can address the real challenge of bringing down the trade account deficit, which directly impacts the current account deficit," the minister said. President of the Federation of Indian Export Organisation (FIEO) M Rafeeque Ahmed said the incentive measures would help boost export and create new employment.
"Pragmatic announcement on SEZ by reducing the land requirement by 50 percent and linking it to built up area will renew the interest in SEZ scheme," Ahmed said.
Chairman of Apparel Export Promotion Council (AEPC) A Sakthivel said the measures would help revive garment exports. "Measure like expansion of zero duty EPCG scheme, extension of TUFs benefits to EPCG, announcements on promotion of incremental exports and winding the ambit of market and product focus scheme, and extension of interest subvention till March 2014, etc will help in promotion of garment exports from India," he said.
India's garment exporters are facing tough times due to increased competition from Bangladesh and China in the US and European markets. A Sharma said he wanted raising FDI ceiling in the defence sector so as to boost manufacturing locally. He also made a case for increasing the FDI cap in insurance from 26 per cent to 49 per cent, a bill for which is pending in the Rajya Sabha since 2008.
"We will be looking at other sectors in particular to give a thrust to advance manufacturing. We have strongly favoured increase in FDI cap in the defence production so that we increase defence manufacturing in India. These are under active consideration because these are sensitive decisions which will require inter-ministerial reflection," he said.
Currently, only 26 per cent FDI is permitted in the defence production, which the Department of Industrial Policy and Promotion (DIPP) is proposing to raise to 49 per cent.
Exports picking up gradually
New Delhi (PTI): Reflecting some recovery in the global markets, India's exports grew for the third month in a row, rising by 6.97 per cent in March though on annual basis it declined 1.76 per cent to $300.6 billion in 2012-13. Exports in March stood at $30.8 billion compared to $28.8 billion in the same month of previous year.
Imports dipped by 2.87 per cent to $41.16 billion in March, leaving a trade deficit of $10.31 billion from $13.5 billion in March last year. In January, it had widened to $20 billion, the second highest figure ever in a month. However, for 2012-13, the trade deficit grew to $190.91 billion as against $183.3 billion in the previous fiscal.
With a view to boost exports, the government announced several measures in foreign trade policy (FTP) including extension of the popular EPCG scheme to all sectors and sops for Special Economic Zones (SEZs).
Exports had entered positive zone after a gap of eight months in January when it recorded a growth of 0.82 per cent. Commerce Secretary S R Rao said exports are gradually picking up and hoped the current trend will continue.
"Export performance has started picking up. For March, the export performance has picked by a slightly robust figure as compared to the previous two months. We do expect this trend to continue and we would like to consolidate," Rao said.
He said if the current trend continued, India's exports is expected to grow by about 10 per cent this fiscal.