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Exim policy seeks to enhance export competitiveness

BS Economy Bureau

The Exim policy for the next five years does not seek to subsidise exports, but to increase their competitiveness by immunising them from the disadvantages of the domestic economy.

Stating that Indian exports faced several constraints like poor infrastructure, high taxes and high cost of power and interest rates, the director-general of foreign trade N L Lakhanpal said the policy had tried to address all those issues.

Speaking at a roundtable on the Exim policy organised by the Confederation of Indian Industry, he said export credit would now be available at 2.5 per cent below the prime lending rate and if exporters chose to service export credit in hard currency through their Export Earners' Foreign Currency accounts, credit would be available to them at only 0.25 per cent above the Libor.

The scheme on central assistance to states would take care of complimentary infrastructure and be used for developing minor ports and building link roads from national highways to production centres.

He said a cell would be set up to monitor implementation of the proposals in the Exim policy for 2002-07. Dispensation of the issue of Duty Exemption Entitlement Certificate books and logging by the customs department for exporters who have taken advance licenses post-March would be considered for earlier licence holders, he added.

Review of the Duty Entitlement Passbook scheme when states moved to a uniform value-added tax would benefit exporters because then it would be possible to provide them with a rebate on state-level taxes, which was not possible now, he said.

On the fuel subsidy announced in the policy, he said in addition to the 13 groups covered by the scheme, additional product groups to which subsidy could be provided would be announced soon.

He also said the government would allow the acceptance of partial bank guarantees for advance licences where the level of exports was below the licenced amount.

Speaking on the export target of 12 per cent set for the next five years, he said the government had not let the current year's export performance effect the projections for the next five years.

He said considering the global economic scenario, it was creditable that the country had managed to maintain its export level this year.

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