Fieo urges Centre for export package

Amid concern over the appreciation of rupee hitting the exporters, the Federation of Indian Export Organisations (Fieo) has appealed to the finance minister to implement the export package announced by commerce and industry ministry with immediate effect.

"The exporters were assured of a compensation package during our last meeting with the commerce and industry minister but it has not yet been implemented.

The fast appreciating rupee has a major impact on the exporters, which needs to be addressed without any delay," Ganesh Kumar Gupta, president, Fieo, said.

Gupta pointed out that there would be loss of about $12.5 billion of exports and 8 million jobs in various sectors in the current fiscal.

According to Fieo, secondary data on different sectors reveals that export realisations have fallen by 12 per cent for chemicals, 6-6.5 per cent for textiles, and exports in processed food and agro-products, electronics and electrical items and steel products are expected to fall by 20-25 per cent.

Gupta outlined the possible recommendations that could be implemented to address this issue, which included a reimbursement mechanism based on the net foreign exchange (NFE) realisation, the pegging of rupee to various currencies of competitor countries to minimise the fluctuations of dollar movement and provision of export credit at existing bank rates uniformly for 360 days to all exporters, including non-status holders.

He also urged that the duty entitlement pass book (DEPB) scheme and drawback rates be increased by five per cent and that the re-introduction of income tax exemption under Section 80-HHC be considered.