Export schemes set for revamp

RUN UP TO THE EXIM POLICY

The forthcoming Exim policy is expected to introduce changes in three incentive-linked schemes for exporters "" Target Plus, Vishesh Krishi Upaj Yojana and Served from India. The three schemes were announced in the Exim Policy in 2004.

Senior government officials said while contours of the entire Target Plus scheme would be changed, norms for the Vishesh Krishi Upaj Yojana and Served from India would be tightened.

The changes are being proposed on the basis of recommendations made by a two-member committee comprising member, Customs, A P Sudhir, and Director-General of Foreign Trade K T Chacko which reviewed the export promotion schemes.

The committee had favoured discontinuation of Target Plus and said norms for the incentive schemes should be tightened as they were not compatible with World Trade Organisation provisions and could invite countervailing action.

Officials said Target Plus was likely to be reworked as a focused market and product specific scheme.

Under it, incentives would be given to exporters to push up exports to markets with a negligible share in India's merchandise exports. Incentives would similarly be provided for exporting products which have huge employment potential such as leather, marine products, handicrafts and sport goods.

An alternative proposal being considered was to operate Target Plus on the lines of the Duty Entitlement Passbook scheme. The DEPB provides reimbursement of basic and special customs duty paid by an exporter on an imported input used in an export product.

The benefit is given by way of a grant of duty credit against the export product at specified rates.

The officials said no new agricultural products would be covered under the Vishesh Krishi Upaj Yojana and incentives were likely to be given to exporters who use domestic raw materials rather than imports. There was also a proposal to cap the revenue outgo under each of these schemes, they said.