Farm exports to get duty concessions

The new year is set to begin on a positive note for exporters. The government is set to issue notifications to implement provisions of the Vishesh Krishi Upaj Yojana and the Target Plus. These schemes were announced in the Foreign Trade Policy last year.

The schemes could not be implemented in the last year since their notifications were held up following concerns raised by the agriculture ministry over the items to be imported under the schemes.

"The commerce ministry had consultations with the agriculture ministry and the finance ministry. It had been decided that barring a small negative list, most items would be allowed to be imported under the schemes. The list would be notified soon," a commerce ministry official told Business Standard.

Under the Vishesh Krishi Upaj Yojana, exporters of fruits, vegetables, flowers and minor fruit produce would be entitled for duty credit scrip equivalent to 5 per cent of the free-on-board (FOB) value of exports for each licensing year commencing from April 1, 2004.

Officials said all agricultural products listed in Chapter 1-24 of the ITC (HS) Classification of export and import items would be permitted barring items in chapter 8 and 14, which include edible fruits and nuts, and vegetable products, including bamboo. In addition to these are items in chapter 7 and 9, which have tariffs of more than 30 per cent, would also be restricted under the scheme.

The Target Plus scheme also seeks to reward incremental exports by granting a duty credit limit of 5 to 15 per cent. The duty credit can also be used to import any inputs, capital goods including spares, office equipment, professional equipment and office furniture.

The finance ministry has also raised concerns regarding value-addition norms for export of studded jewellery under the Target Plus scheme. "The commerce ministry has proposed a value-addition norm of between 15-20 per cent. The matter is being discussed with the finance ministry and a decision is expected soon," an official said.

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Farm sops

Under the Vishesh Krishi Upaj Yojana, exporters of fruits, vegetables, flowers and minor fruit produce will be entitled for duty sops

The Target Plus scheme seeks to reward incremental exports by granting a duty credit limit of 5-15%

The schemes could not be implemented last year as the ministries of agriculture and commerce could not come to a consensus