The mid-term review of the Foreign Trade Policy (2015-20) has brought in additional relief worth Rs.8,450 crore annually for the labour-intensive and micro, small and medium enterprises (MSME) sectors.
Exporters of labour-intensive items, such as leather and footwear, agriculture and marine products, handmade carpets, telecom and electronics components, and medical and surgical equipment, will now be eligible for 2 per cent higher incentives across-the-board under the popular Merchandise Export from India Scheme (MEIS), under the review released by Commerce and Industry Minister, Suresh Prabhu on Tuesday.
A number of services such as accountancy, architecture, legal, education and restaurant, too, will get similar relief under the Services Export from India Scheme (SEIS).
The incentives come at a time when exporters are struggling under the new Goods and Services Tax (GST) regime introduced in July. Prabhu said the government was committed to redress the problems. It is not a one-time exercise but an ongoing effort. We will continuously revisit issues, identify challenges and address them on a real-time basis, the Minister said.
Acknowledging that exporters had suffered due to problems in GST implementation, Prabhu said the government would sort it out together with exporters. No new legislation can be made perfect in one go. I ask exporters to bear with us and be our partners in dealing with the problems, he said, adding that a number of problems had already been sorted out.
Exporters who were upset by the drop in goods exports in October 2017, and were expecting a further fall over the next few months due to lower duty drawback rates (of input tax reimbursement) and slow refunds, seem more optimistic now.
The higher incentives should start reflecting in export numbers from January. However, we are disappointed that a number of sectors were left out. Problems for exporters exist across sectors and the relief should have been for all, said Ganesh Kumar Gupta, President, FIEO.
Other initiatives like the extension of validity of MEIS scrips from 18 months to 24 months and the provision of zero GST on sale of scrips will help the industry in a big way, Apparel Export Promotion Council Chairman Ashok Rajani said.
Original Source: thehindubusinessline.com