Exporters seek sops
Reeling under the impact of shrinking demand from key western markets, Indian
exporters have demanded a slew of sops, including exemption from payment of
fringe benefit tax, increase in the reimbursement rates for various input duty refund
schemes and an exemption on payment of service tax on all services used.
Representatives from eight export promotion councils and the Federation of Indian
Export Organisations (Fieo) met finance minister Pranab Mukherjee on Tuesday,
requesting him to include these measures in his Union Budget slated for next month.
With exports falling by 33% in April, giving policy support to the segment has
become one of the priorities of the new UPA government.
"The FM was quite sympathetic towards us. While he did not give an immediate
response to our demands, he acknowledged that export was one of the worst hit
sectors of the economy. He promised us that the government would do whatever it
could to support us," Fieo director general Ajay Sahai told ET.
The list of suggestions forwarded by Fieo chief A Sakthivel include an exemption
from payment of FBT by exporters—a demand long pending with the government —
and an income tax exemption for five years for exporters. It also asked for an
increase in the input duty reimbursement rates under various schemes such as DEPB
and drawback to help "neutralise" the fiscal stimulus packages being given by other
countries including China, Vietnam and Bangladesh.
Apparel Export Promotion Council (AEPC) chairman Rakesh Vaid pointed out to the
FM that there was a continuous decline of exports since September 2008.
In the month of April 2009, the decline was around 8%. The demands made by AEPC
for the textiles sector include an enhancement of the technology upgradation fund
for the sector, an increase in the discount on interest rates being given to textiles
and exemption of customs duties on import of machinery.
Secretaries in the commerce, revenue, expenditure and finance departments also
attended the meeting.
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