The government today released Rs 800 crore to be paid to exporters as duty drawback and refund of central sales tax giving them a major relief in the face of credit crunch due to the global meltdown.
Simultaneously, the Directorate General of Foreign Trade (DGFT) also started putting the stimulus package into operation for exporters by hiking the duty refund rates and restoring them to the level before November 5, 2008, when the reimbursement was cut.
A sum of Rs 600 crore was dispatched to the regional authorities of the DGFT for clearing payment of the terminal excise duty and duty drawback under the deemed export scheme, official sources said.
Another Rs 200 crore were send to the Development Commissioners of the special economic zones for the payment towards the Central Sales Tax in respect of supplies made to 100 per cent export oriented units.
As promised in the second stimulus package unveiled on January 2, 2009, the DGFT notified extension of the popular Duty Entitlement Pass Book scheme for refund of taxes to exporters, till December, 2009.
The government had cut the tax refund rates for exporters in November after rupee appreciated fast to give higher realisations. However, with the worsening of the global markets, mainly the US and Europe, exports have started contracting putting lakhs of jobs at risk.
Concerned over the plight of exporters and the employment stakes in the sector, the government in the second stimulus package announced restoration of the DEPB benefits taken away in November last year.