New Delhi, Jan. 19: The government is likely to announce more export stimulants for firms in textiles, light engineering, jewellery and handicrafts who are stricken by the global recession.
“The government will continue to inject adequate funds and provide stimulus to the economy,” Union commerce minister Kamal Nath told reporters on the sidelines of a CII meet here today.
Nath, who would be meeting exporters later this week, said the government might consider procedural changes. In its meeting with the minister, the Federation of Indian Export Organisations (Fieo) will lobby for reliefs to prevent huge job losses.
The labour-intensive export sector employs 150 million and contributes about 20 per cent to the country’s gross domestic product.
Exporters have sought an increase in duty drawback rates and DEPB by 3 per cent and an additional 2 per cent interest subsidy. They also want a 5-year income tax holiday and a 2-year moratorium on term loans. DEPB stands for duty entitlement passbook and is an import duty refund scheme.
According to Fieo president A. Sakthivel, the extension of DEPB up to December 31, 2009 in the second stimulus package was a routine announcement.
Exports of leather, handicraft, textile, knitwear and gems and jewellery have been severely hurt by the recession.
Sakthivel said Indian firms have been hit by China’s decision to raise VAT refund rates, and similar relief was necessary.
Without incentives, there would be more unemployment. The government might miss the export target of $200 billion, he said.
Source : www.telegraphindia.com