Projecting at least 30 per cent dip in coffee exports this year, traders have opposed the new policy of capping the duty incentive on outbound shipment of the bean at 7 per cent from 7.5 per cent earlier.
Before the announcement of the Foreign Trade Policy for 2009-14 last week, coffee exporters were getting a 3.5 per cent duty credit scrip under the Vishesh Krishi and Gram Udyog Yojna, apart from a 4 per cent incentive under the Duty Entitlement Passbook Scheme.
However, with the new policy capping the overall duty incentive for coffee shipment at 7 per cent, the cause of exporters has been dealt a blow, according to Coffee Exporters’ Association President Ramesh Rajah. India had exported 219,000 tonnes of coffee in calendar year 2008.
“We urge the Centre to provide us 7.5 per cent duty, as was the case earlier. Exports may be down by 30 per cent this year on a slow down in demand overseas. But if the 7.5 per cent duty incentive is not granted, the export may slump further,” Rajah said.