Govt brews sops for exporters.

New Delhi, Aug. 8: The government is likely to set an export target of $200 billion in its foreign trade policy and offer incentives to textiles, readymade garments, leather and handicraft units, which are in the red.

The policy will set an export target of $200 billion for 2010-11 against $176 billion in 2009-10, with a 15 per cent annual growth over the next two years and a 25 per cent growth thereafter, officials said.

Sources said the announcement of the policy had been pushed back to August 23 from August 10 as the consultation process with the industry associations were still on. Moreover, the report of the Federation of Indian Export Organisations (Fieo) on the impact of expanding to non-traditional markets is yet to be submitted.

Commerce and industry minister Anand Sharma will unveil the policy after his trip to China for the Shanghai Expo and before the monsoon session of Parliament ends on August 26.

The trade policy will contain a mix of fiscal incentives and the simplification of procedures. The government may also announce some new measures and retain certain others, officials said

Fieo has sought the continuation of schemes such as duty drawback, advance authorisation, duty entitlement passbook (DEPB), duty-free import authorisation and export promotion capital goods (EPCG). It also wants the export credit to be capped at the base rate so that exporters are able to get loans at about 8 per cent interest. It has also asked for the extension of zero-duty EPCG scheme to all sectors for technological upgradation. Sources said the DEPB scheme would be extended till the introduction of goods and services tax (GST).

As of now DEPB, which neutralises the incidence of duties, is set to expire on December 31. GST seeks to replace all indirect taxes with a single levy at the point of consumption, with proceeds shared among Centre and states.

Measures to reduce the transaction cost such as replacing the requirement of filing separate invoices for customs, excise and value-added taxes with a single invoice, could be incorporated. “We are looking at market expansion and product diversification as they are the key to export growth, which has turned positive with the new initiatives to deal with the challenges of global slowdown,” a senior commerce ministry official said.

The ministry is expected to bring countries such as Russia, Ukraine, Turkey, Nigeria and Vietnam under the focus market scheme.

Source : telegraphindia.com