Export Incentives for more than 600 Products
Announced – Notifications Awaited
Anand Sharma, Union Minister of
Commerce & Industry, interacting with the media persons on 11 February,
announced further export incentives for more than 600 products w.e.f. 1/1/2011
in the sectors viz., agriculture, chemicals, carpets, engineering, electronics
and plastics, to enhance the competitiveness for products which are
labour-intensive and technology intensive. He informed that the export target
of US $ 200 billion will not only easily be achieved but exports will go beyond
that. He said that the export growth of 25% per annum, the exports will be
doubled by 2014. In terms of percentage terms of exports, he said that it will
be doubled by 2020. Dr. Rahul Khullar, Commerce Secretary and Dr. Anup K
Pujari, Director General of Foreign Trade, were present during the event.
The
salient features of these incentives are:
1.1 Market Linked Focus Product
Scheme (MLFPS):
1.1.1 335 New Products incentivised under MLFPS
at 8 digit level, eligible for benefits @ 2% of FOB value of exports to 15
specified markets. These markets are Algeria, Egypt, Kenya, Nigeria, Tanzania,
South Africa, Ukraine, Mexico, Brazil, Australia, New Zealand, Cambodia,
Vietnam, China and Japan.
These
include Agricultural Tractors of more than 1800 cc; all inorganic chemicals and
inorganic/organic compounds of metals of Chapter 28; Flexible Intermediate Bulk
Containers; and Narrow Woven Fabrics.
1.1.2 71 new products of Chapter 63 –
Textile Made ups at 8 digit level for exports to EU (27 Countries) under
MLFPS have also been incentivised @ 2% of FOB value of exports.
1.2.1 147 products incentivised for Bonus
Benefits (additional 2%) under FPS at 8 digit level, henceforth eligible
for benefits @ 4% or 7% of FOB value of exports to all markets.
These
include Engineering Items like Galvanized Flanges on Iron and Steel, Threaded
Nuts (7%); Ferro & Silico Manganese; Electronic Items like co-axial cables
and other co-axial electric conductors, Watches; Stationery items like Pencils,
Pens; Textile Items like Silk (of Chapter 50), Grey Rayon Tyre Cord Fabric, and
Handmade Carpets and other Floor Coverings under Chapter 57 (7%).
1.2.2 57 New products incentivised under FPS at
8 digit level, eligible for benefits @ 2% of FOB value of exports to all
markets.
These include:
·
Engineering
Items like Industrial Synthetic Foaming Fabric and Electric Discharge Machine
Wire (Brass Wire); Laminated Leaf Spring; Plastic Extrusion Plant and
Machinery; Parts for Plastic Extrusion machinery; ERW Pipes; Ferro Chrome;
Electronic Items like Connectors- Plugs and Sockets; Permanent Magnets and
Parts of Electro magnetic Couplings etc.;
·
Chemical
Items like Danes Salt of D_Phenyl Glycine; Pigments; Articles of Paper Board;
Permanent Magnets and Parts of Electro magnetic Couplings etc.; Cobalt
unwrought etc.; other cobalt items;
·
Paper
Products like Articles of Paper Board;
·
Rubber
Products like Pneumatic Tyres and Pneumatic Inner Tubes;
·
Plastic
Products like Reprographic films, Bags of Polyethylene;
·
Leather
items like Chamois Leather;
·
Textile
Items like Industrial Synthetic Foaming Fabric; Polyester Oriented Yarn,
Polyester Staple Fibre, Made-ups of Man Made / synthetic material under Chapter
63;
·
Miscellaneous
items like Human Hair.
1 product (Egg powder) incentivised as Special
Focus Product at 8 digit level, eligible for benefits @ 5% of FOB value of
exports to all markets.
6 New products (Castor Oil Meal – Defatted Variety
and Instant Coffee) incentivised under VKGUY at 8 digit level, eligible for
benefits @ 5% of FOB value of exports to all markets.
2. At the time of the announcement of FTP, I had
announced that we shall take concrete measures for reduction of transaction
costs. I had constituted a Task Force on transaction costs under the guidance
of the Minister of State. The report of the task force has been released by
Hon’ble Finance Minister on the 8th February 2011. The report enlists action
taken on 23 issues by different line ministries, which is likely to mitigate
transaction cost to the tune of Rs. 2100 crores in perpetuity. I am of view
that procedural simplification and facilitation is a continuing endeavor on our
part. Therefore, over and above the task force initiatives, I announce
following further measures for procedural simplification and export
facilitation:
2.1 In order to make filing and issuance of IE
Code hassle free with minimum human interface between the applicant and the
Regional Offices, an additional facility of filing “on-line” application for
obtaining IEC is being introduced. A comprehensive “on-line” application
filing facility for obtaining IEC is made available on the DGFT’s website. It
includes payment of application fee through Electronic Fund Transfer (EFT) and
also the provision to attach required documents like photograph of applicant,
copy of PAN and bank certificate “on-line”.
2.2 The scope of Advance
authorization for Annual Requirement is being enlarged to allow a maximum of
five authorizations in a licensing year (instead of only one at present)
for the product(s) falling within the same product group. This facility
shall be helpful for exporters having multiple manufacturing units, located in
one place or having common port of import. This will be useful for all sectors
and particularly so for the sectors like Engineering, Textiles, Chemicals etc.
2.3 Technical
characteristics / quality etc of certain specified items of imports shall be
required to be declared at the time of clearance of import consignment and not
at the time of filing application (current stipulation) for annual advance
authorization to Regional authority. By this facility, the exporter
shall have the flexibility to import the relevant inputs, without the need to
approach the Regional authority of DGFT to amend the authorization for
clearance of such consignment.
2.4 The period to
fulfill the export obligation under advance authorization scheme 36 months from
the date of issuance of the authorization. However this period is shorter for
products being manufactured from certain duty free imported inputs, which are
sensitive from domestic angle. In such cases, the period for fulfillment of
export obligation is presently counted from the date of clearance of first
import consignment even when a number of consignments have been cleared in
different dates. Henceforth, with a view to provide greater flexibility,
Export obligation period in such shorter EO period cases of advance
authorizations shall be counted from the date of clearance of each consignment
and not the first consignment. This will allow a more reasonable time
period for EO fulfillment to exporters.
3. For Indian exports to sustain in long run, it
is important that we proceed to build a reputation for the quality of our
products and also provide our exporters the necessary flexibilities to be able
to face challenges of emerging dimensions of international trade. Our
pharmaceutical sector has shown an inherent strength during difficult times. In
order that the quality of our pharma product gets recognized world over and to
enable them to undertake exports while navigating the challenges posed by
intellectual property rights, I announce following initiatives for pharma
sector:
3.1 Exporters of
pharmaceutical products will be required to affix barcodes on their export
products, with effect from 1st July 2011, as per GS 1 global standards,
to facilitate tracing and tracking of their products. This will provide
assurance about the quality of Indian pharma products to prospective importers.
3.2 We are providing a
new facility of Input combination for pharma products manufac-tured through
Non-Infringing process, allowing actual quantum of duty free inputs
required for manufacturing such export product. This will facilitate our pharma
manufacturers to work towards getting a major share of exports of such products
to potential regulated markets such as US or EU.