Relief for export obligation defaulters

 The benefit will be available to EPCG licensees of over Rs 100 crore. They will now get 12 years to meet their stipulated levels of exports, which will also have a five-year moratorium.

 As announced by commerce minister Murasoli Maran in his Exim Policy speech, the export obligation period for industries, like steel and automobiles, which have long gestation periods, will be increased considerably. The demand for extending the export obligation period was raised by the steel industry.

 Under the scheme, announced in 1990, concessional import duty is levied and exporters have to undertake exports over a period of five to eight years. The export obligation is in addition to the annual average value of exports made during the preceding three licensing years. Commerce ministry officials said the four-year extension was granted in view of the depressed markets globally, which had affected the country's exports.

 Maran also announced that units that had approached the Board for Industrial and Financial Reconstruction would be given an additional period for fulfilment of export obligations. "These units are facing problems in marketing their produce and we wanted to reduce their burden," an official said.

 Also, export obligation in respect of past cases of imports of second-hand capital goods under the EPCG scheme will be set again.

 Supplies that were considered as deemed exports will also be eligible to be counted as part of export obligation fulfilment and will be eligible to be treated for getting deemed export benefit.

 Nearly 7 per cent of the stipulated export obligation for 1990-91 is yet to be fulfilled. In all, 18,309 licences have been issued under the scheme and the total export obligation imposed on these licence-holders is estimated to be about Rs 204,450 crore at the end of 2000-01.

 Of this, 10,242 licences have been issued in the last five years involving contractual exports to the tune of Rs 170,000 crore.