Financial Daily from THE HINDU group of publications
Monday, Apr 01, 2002
Industry & Economy
Exports to new markets to go up 15-30 pc
MUMBAI, March 31
EXPORTS to new markets such as Latin and South American countries and also to Africa, will go up by 15 to 20 per cent after the Exim policy initiatives are fully implemented.
The main reason for this would be diversion of Indian exports from the European Union and the US towards these new markets, Mr Ramu Deora, former chairman, FIEO said.
The new policy has been made more export friendly as exporters will now be allowed to maintain 100 per cent foreign exchange in their EEFC accounts. But the Reserve Bank of India should clarify whether exporters will earn interest on this foreign exchange.
The deemed exports benefits which are presently granted to physical exports of capital goods for discharging export obligations should also be extended to advance licence holders and interim licence holders.
Allowing `status holding export houses' to send export documents to buyers in 360 days instead of 180 days will help reduce transaction costs.
Also, the policy will benefit agro exports as three per cent DEPB granted to small packs of one kilo will help push Indian products in international markets.
Mr Rajiv Pandia, President, Indian Chemical Manufacturers' Association, said the continuation of Duty Entitlement Pass Book scheme is a welcome move as this encourages utilisation of local capacity.
It is more relevant this year as the much-awaited Valued Added Tax system has not been introduced.
The decision to continue the EPCG scheme was also welcome.
Also, the Government seems to have responded to ICMA's requests that deemed exports to be treated on par with physical exports, duty-free imports of fuel be allowed and units be permitted the flexibility to import useful second-hand equipment.
The policy emphasises on procedure simplification and reduction in transaction costs. But there is still a need to take a serious look at procedures followed by Asean countries.
In Singapore, for instance, export transaction permissions can be sought in three minutes, over the Internet.
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