Govt speeds up tax refunds for exporters

Concerned over the plight of exporters due to a shrinking market, the government on Thursday offered succour to the industry to pull through this phase by speeding up refunds and easing curbs on raw material imports. It also threw in a Rs 325 crore package for the leather and textile sector that has seen the maximum erosion in business and loss of jobs. In the interim Foreign Trade Policy unveiled on Thursday, Commerce and Industry Minister Kamal Nath scaled down the export target for the current fiscal to USD 170-175 billion dollar from USD 200 billion set earlier. He retained USD 200 billion as the target for 2009-10. Under the new policy, exporters can claim tax refunds without having to wait for payments to realise. This will help the exporter community keep their business cycle running. "This will help almost all exporters," Export Promotion Council for EoUs and SEZs' Director General L B Singhal said. The Policy, released in the run-up to general elections, also focussed on helping the gems and jewellery sector by making import of precious raw material easier. India managed to achieve exports worth USD 144 billion for the April-January period against the backdrop of a sharp erosion in demand for merchandise in the American and European markets. Following a demand from the health sector, the Policy has permitted export of blood samples without licence after obtaining 'No Objection Certificate' from the Director General of Health Services. Export of handmade carpets will now get five per cent incentive against 3.5 per cent earlier, Nath said. Exporters who get credit under the Duty Entitlement Pass-Book Scheme will be able to use the same for paying duty on import of restricted items as well. Earlier, the DEPB credit could be set-off against import of those items which are allowed without restrictions. Under the Export Promotion Capital Goods (EPCG) Scheme, export manufacturing units are allowed duty free imports or concessional imports of machinery under an obligation of exporting a fixed amount. In the backdrop of declining exports, the units have been given a breather in case of decline of exports by more than five per cent. The obligation period is up to 36 months. The Central Board of Excise and Customs also clarified that offering architectural, market research and general insurance services overseas would be treated as exports. The UPA Government under different stimulus packages has already given sops like interest subsidy to exporters. Nath said there were limits to what the government can do. "I cannot formulate a policy for Europe and the US," he said.

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