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22
January 2019
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exports (The Total Investment & Insurance Solutions)
Exporters are likely to get incentives based
on parameters like research and development, productspecific clusters and
production pattern under a five-year foreign trade policy (FTP) to be released
later this year, an official said.
The commerce ministry is working on recasting
the existing export incentive schemes in line with the global trade norms of
the World Trade Organisation (WTO). "We are recasting our export incentive
schemes. In the new FTP, they would be in compliance with the global trade
rules.
The new incentives could focus on R&D
activities, production parameters, productspecific clusters. Rebate can also be
given on state levies," the official added. The last FTP was released in
2015 for five years. It provided guidelines for enhancing exports with an
overall objective of pushing economic growth and job creation. Under an FTP,
the government announces incentives for exporters.
Currently, duty benefits are provided under
merchandise export from India scheme (MEIS) and services export from India
scheme (SEIS). Recasting of the existing support measures assumes significance
as the US has challenged these schemes under the dispute settlement mechanism
of the WTO. America has alleged that these incentives are harming American
companies.
The official said there are several
productspecific clusters in sectors such as automobile, textiles and leather
and providing direct incentives to them would help boost manufacturing and
exports.
Currently, maximum incentives are cornered by
big automobile and pharmaceutical companies under MEIS. In this scheme, the
government provides duty benefits depending on product and country.
"Ideally, the scheme should target MSMEs," the official added. For
the new FTP, the commerce ministry is engaged with all commodity boards and
ministries concerned for identifying the support measures compliant with global
trade rules. According to Federation of Indian Export Organisations (FIEO), the
new scheme should include refund of indirect taxes like on oil and power; state
levies such as mandi tax.
"The new scheme should help boost the
country's exports," FIEO President Ganesh Gupta said. Since 2011-12,
India's exports have been hovering at around USD 300 billion. During 2017-18,
the shipments grew about 10 per cent to USD 303 billion.
Promoting exports helps a country create
jobs, boost manufacturing and earn more foreign exchange. During April-December
2018-19, the country's total merchandise exports grew 10.18 per cent to USD
245.44 billion.The Total Investment
& Insurance Solutions
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