| Date: |
31-03-2015 |
| Subject: |
Commerce department falls short of funds for building export infrastructure |
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NEW DELHI: The BJP government's move towards 'fiscal federalism', resulting in direct transfer of funds to states, has left the commerce department without money to set up new expo centres or testing labs for exports.
That's because the finance ministry has decided to do away with Assistance to States for Infrastructure Development of Exports, or the popular ASIDE scheme, through which 80% of the funds were transferred to the states, based on their export performance.
The Centre allocated the remaining 20% to agencies such as APEDA, MPEDA, special economic zones (SEZs), container freight stations or ports for setting up labs and testing facilities, or bridging critical infrastructure gaps. Over the past decade or so, nearly 2,000 projects had been funded, which included 400 projects directly funded by the central agencies.
The list includes projects such as the Expo Centre in Greater Noida and infrastructure development at Nathu-la. As part of the revamped strategy announced in the budget, the commerce ministry will have no funds to take up such projects as the entire money will go directly to the states.
"It looks like an anomaly, which we are hoping is corrected by making funds available to us. Otherwise, central government agencies will not have funds to create export infrastructure," said an official, who did not wish to be identified. Sources indicated that the issue is being discussed with the finance ministry in the run-up to the Foreign Trade Policy, which is due on Wednesday.
In fact, the commerce department could not announce the five-year policy during 2014-15 as the finance ministry was unable to set aside additional resources. Although the Narendra Modi government's push to doing away with a majority of the Centrally Sponsored Schemes has come in for praise, it has left some of the agencies at the Centre with little funds to pursue ongoing schemes.
Source : economictimes.indiatimes.com
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