8 April 2005
NO TAX ON FARM EXPORTS
From Jal Khambata
NEW DELHI: As a part of the Government's resolve not to export taxes and duties for international competitiveness, the Union Commerce Minister on Friday announced abolition of the cess on all agricultural and plantation commodities levied under various Commodity Board Acts.
Unveiling annual supplement to India's Foreign Trade Policy at a Press conference in Vigyan Bhawan here, Kamal Nath this cess was "a handicap and a major irritant to our exports and erodes the competitiveness of Indian agriculture exports."
The small ports in the states like Gujarat will benefit from another initiative announced by the minister to reduce congestion at the major ports. So far, the export obligations were required to be discharged only from the notified major ports. Now it can be done also from not only the minor ports but also from the inland container depots (ICDs) and container freight stations (CFS).
EXPORTS UP BUT IMPORTS STILL HIGHER
From Our Delhi Bureau
NEW DELHI: India recorded a record growth rate of 24 per cent in exports, "unprecedented in the country's economic history, touching almost 80 billion US dollars during the year ending March 31, 2005 and yet it could not match the imports which shot up by 34 per cent over the previous year to hit 105 billion US dollars.
While expressing satisfaction over the exports surpassing the target of 74 billion US dollars he had set, Commerce Minister Kamal Nath on Friday raised the current year's export target to 92 billion dollars. He also exuded confidence that the India would cross the 150billion dollar milestone earlier than the target of 2009 if the momentum is maintained.
Releasing the supplement to the Import-Export policy at a Press conference here, Kamal Nath claimed the exports actually exceeded imports by almost four billion US dollars "if the oil imports (29 billion dollars) were not to be counted."
With India's total trade engagement with the world, worked out by totalling imports and exports, stood at 185 billion US dollars which was 30 per cent up from the previous year's total of 142 billion US dollars. "With this kind of involvement, India is inching towards becoming a significant player in international trade," Kamal Nath declared.
This has been possible, as he explained, because "our tariffs are coming down to ASEAN levels, our FDI regime is increasingly liberal, and our domestic laws are TRIPS-compliant."
In order to give a boost to rural areas, Kamal Nath also announced extension of benefits under the "Vishesh Krishi Upaj Yojana" (special farm produce scheme) to exports of poultry and dairy products. The benefits are already available for export of flowers, fruits, vegetables, minor forest produce and their value-added products.
To promote export of the minor forest produces, he designated Shellac Export Promotion Council as the designated export promotion council for such produces. The agro units are being extended the liberal concessional duty imports, reducing their export obligation.
Under the Export Promotion Capital Goods (EPCG), these units were supposed to export the items worth eight times the duty saved within eight years. Now the time limit has been raised to 12 years and the export obligation has been reduced to six times.
Kamal Nath also announced that the government would develop a trade mark for handloom on the lines similar to the woolmark and silkmark to enable the handloom products develop a niche market with a distinct identity.
The small scale industries have also been allowed imports of capital goods at the nominal custom duty of five per cent. The rider is that they must export six times the duty saved on capital goods within eight years.
Gems and jewelery section has not been left behind as its entitlement of duty free imports of samples has been raise to Rs 3 lakhs in a year. The minister also announced that the gem and jewelery sector will get gold of 0.995 and higher purity for export purposes.
Yet another decision to drastically cut down the paper transactions has been achieved through procedural simplification that will enable the government to introduce a single common application form called "Aayat Niryat Form" (Import-Export Form). He said the documentation requirement in the new form will be reduced by more than 60 per cent. The new form will be of only 50 pages as against the current one running into 120 pages.
The Director General of Foreign Trade has also been directed to move towards an automated electronic environment for filing, retrieval and authentication of documents. To enable users make commercial decisions in a more professional manner, trade data shall be made available with minimum time lag in a query-based structure form.