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Posted on Dec 26, 06:57PM | IBNS
Union Commerce Minister Anand Sharma announced additional incentives to boost exports here on Wednesday.
These incentives came in the backdrop of the Annual Supplement of the Foreign Trade Policy announced on June 5.
Speaking to media here, Sharma said that the 2pc Interest Subvention Scheme on rupee export credit which is available to certain specific sectors including handicrafts, carpets, handloom, readymade garments, processed agriculture products, sports goods and toys, has been given an extension up to March 31, 2014.
"At present, the Scheme is scheduled to end on 31st March 2013. Along with this, Small and Medium Enterprises (SMEs) for all sectors will now be able to avail the benefits of the Scheme," he said.
Sharma, while highlighting that the engineering sector has been a major contributor for both job creation and value addition of Indian manufacturing, extended the benefits of 2pc interest subvention to certain specific sub-sectors of the engineering sector.
"They will receive this benefit from the last quarter of the current financial year, that is, from 1st January 2013 till 31st March 2014," said Sharma.
He also announced the introduction of a "pilot scheme" of 2pc Interest Subvention for Project Exports through EXIM Bank for countries of SAARC region, Africa and Myanmar.
Speaking about the project, Sharma said: "The scheme will be operational immediately for a combined worth of USUSD 500 million to begin with. The interest subvention would be linked to the Buyer's Credit Scheme which was introduced in the last financial year being implemented through EXIM Bank, ECGC and the National Export Insurance Account."
He said: "Objective of the scheme is to boost India's exports in these countries by providing long term concessional credit through EXIM Bank, as co-financing in infrastructure sectors such as drinking water, housing, irrigation, road projects, renewable energy, etc."
Sharma said: "A decision has been taken to grant incentive on incremental exports made during the period January-March 2013 over the base period January-March 2012."
He said the incentive "would be available to an IEC holder at the rate of 2pc on the incremental growth of exports made to USA, EU and countries of Asia".
"But this would not include deemed exports, service exports, third party exports, export-turnover of SEZ units etc.," said Sharma.
Apart from these, Sharma announced that five new countries have been added under the Focus Market Scheme while Eritrea has been added under the Special Focus Market Scheme.
The five countries being added under FMS are New Zealand, Cayman Islands, Latvia, Lithuania and Bulgaria. Under FMS Duty Credit of 3 per cent is given on the FoB value of exports while inder the Duty Credit is 4 per cent.
Sharma further announced that sixty new products which include Engineering, Rubber, Textiles, Drugs and Pharmaceuticals products among others, and three countries (Taiwan, Thailand and Czech Republic) have been incorporated under the Market Linked Focus Product Scheme.
Under the Focus Product Scheme, Sharma said that more than 100 new products have been added from sectors including Engineering, Textiles, Chemicals, Drugs, Pharmaceuticals, Paper, Books, Publication and Printed Material.
The products will be benefitted by 2 per cent Duty Credit. Under the Vishesh Krishi and Gram Udyog Yojana.
Sharma said that Shellac Wax, Flours and Meal of Oilseeds or Oleagenous Fruits having more than 51pc protein, and Food Preparations not elsewhere specified have been added to give a boost to the exports.
He highlighted that the scrips issued under different schemes namely FPS, FMS, VKGUY, SHIS, MLFPS, SFIS, AIIS, for import of goods, will now be permitted to be utilised for payment of Excise Duty for domestic procurement, to encourage manufacturing, value addition and employment.
"This will be an important measure for import substitution and will help in saving of foreign exchange in addition to creating additional employment," said Sharma.