The Indian Drugs Manufacturers Association -- an industry body representing leading pharmaceutical companies -- has made a representation to the Union minister for commerce and industry, Murasoli Maran, highlighting the problems created by the changes in the duty entitlement pass-book (DEPB) scheme.
According to the association, as a result of the change, much of the export activity has been thrown into disarray. The change was brought about by a customs notification dated April 22, 2002. The drug manufacturers say the licensing authorities have issued the DEPB licences for exports effected during the pharmaceuticals policy period 1997-2002 with a notation that the same are governed under the customs notification dated April 7, 1997. But, the customs department is not accepting the licences issued on or after April 22.
While the policy announced that the DEPB scheme would continue, the customs notification dated April 22 effected a great deal of change in the scheme. As per the notification, the special additional duty, which was exempt under the earlier policy, is now debitable from the DEPB licences.
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According to the association, since the previous customs notification has not been rescinded, the DEPB scheme in respect of exports effected during the 1997-2002 policy period should be governed by the same.
According to the drug manufacturers, all exports effected during 1997-2002 and between April 1, 2002 and April 21, 2002 must necessarily be governed by the previous customs notification.
In respect of exports effected after April 22, 2002, either the DEPB rates should be increased to neutralise the incidence of the special additional duty or the notification should be modified in a way that the additional duty is not debited from the DEPB licence, the drug manufacturers say.
According to the drug manufacturers association, the export promotion scheme has become a nightmare. The industry body says that the bulk of the exports from the country that are effected under the DEPB scheme are faced with a great deal of uncertainty. It has requested the minister to intervene in the matter immediately and bring about an early solution to the problem.