Govt's relief package fails to benefit exporters

Arvind Wadhwa's handicraft exporting firm in Moradabad has an annual turnover of nearly Rs 10 crore. Hit by rising rupee, he was keenly banking on the export relief package announced by the finance and commerce ministries on July 12 this year. One month down the line, Wadhwa has Rs 1 crore stuck with the government in the form of duty drawback claims. He hoped that these would be cleared according to the provisions of the export relief package.

"Small exporters like me have hardly got any benefits from the relief package. My drawback claims are stuck and the procedure of filing supplementary claims is very cumbersome and time consuming," said Wadhwa.

The highlights of the export package was the increase of drawback rates by an average 2 percentage to 3 percentage points with retrospective effect from April 1. Moreover, the finance ministry also announced that it would be relaxing the monthly and quarterly ceiling on disbursement of pending deemed export benefits, which were estimated at Rs 600 crore.

"Even normal drawback claims take up to two months to get cleared. We do not know when the supplementary claims of drawback benefits will take place," said Wadhwa. Exporters maintain that to claim the additional amount of drawback benefits between April and July, they will have to file at least six documents, which would then be verified with the original ones.

"According to our estimates, at least 10 lakh drawbacks claims were filed in the period. Thus, exporters would be filing nearly 60 lakh documents with the customs department while claiming the additional amount of drawback benefits between April and July. When even the normal drawback claims take months to be reimbursed, only God knows how long the supplementary claims would take to get reimbursed. The exporters have hardly got any benefit from the export measures," said SP Agarwal, president, Delhi Exporters Association.

The Federation of Indian Exporters Organisation (FIEO) has already written to the finance ministry to make the process of filing supplementary claims automatic.

"The drawback records are already there with the customs. We have requested the finance ministry to adjust the software so that supplementary drawback claims are disbursed automatically. This would give a much-needed relief to the exporters hurt by the rupee appreciation," said a FIEO functionary.

Moreover, exporters claim that there is lot of confusion going on regarding implementation of the announcement made by the finance ministry to reduce export credit interest rates by two percentage points.