Exporters wary of life after DEPB

K T Chacko, director general of foreign trade (DGFT), warned exporters today that migrating into the new system that would replace DEPB scheme would not be easy.

Members of the Engineering Export Promotion Council (EEPC) told him in Kolkata today that the uncertainty over DEPB had put exporters in a fix. They had stopped export orders beyond March 2005. Rakesh Shah, chairman of EEPC, said exporters needed 4-6 months to master the scheme replacing DEPB.

He urged immediate notification of the new scheme so that exporters could start booking orders. "No business can be booked in uncertainty. Exporters need time - for now they need to book contracts upto a date," he added.

Exporters want all items covered by DEPB scheme to be included in the new drawback scheme for refund of customs and excise duty. The pre-condition for import content in the export product should not be a pre-condition to avail of benefits under the new scheme.

The Centre has sought assistance from central trade bodies like CII to frame the new duty neutralising export incentive scheme which will replace the popular DEPB scheme. DEPB (duty entitlement pass book) accounts for 60 per cent of the total export incentive benefit taken by the exporters.

It has run foul of WTO norms and as many countries have slapped countervailing duty (CVD).