Govt to announce annual trade policy tomorrow

The government will present the annual supplement of Foreign Trade Policy for 2007-08 tomorrow amid worries of a strengthening rupee and a global slowdown even as the export target of $125 billion for 2006-07 is likely to be missed.

With the finance ministry resisting any more sops for exports, worried exporters do not expect any big-bang announcements from Commerce and Industry Minister Kamal Nath.

The only exception could be for agriculture exports, which are likely to get a boost for promoting the country's agri-economy. The flagship Vishesh Krishi Upaj Yajona, which provides duty-free credit entitlement, is likely to be expanded to more products and benefit an increased number of farmers. At present, it covers only fruits, vegetables, flowers, minor forest produce and their value added products.

As exports of sectors with large potential like leather, handicrafts and textiles are not keeping pace with overall growth, the policy may attempt to address these issues at least to the extent of simplifying procedures.

While the decision to extend the most popular Duty Entitlement Passbook Scheme (DEPB) has been taken, the announcement may be made in the policy. The government wanted to replace DEPB with a wider scheme that was WTO-compliant but met with resistance from the finance ministry.