Bikky Khosla | 17 Sep, 2019
The last week saw the announcement of a slew of measures by
the government to boost the export sector. It came just a day after our
exports dropped by 6.05 percent year-on-year to
$26.13 billion in August. No doubt, the sops
announced have come at the right time when there are signs of worsening global
trade prospects. Our exporters have long been struggling amid dull economic
conditions - both domestic and global - and the newly announced measures will certainly
give a much-needed relief to them.
Among the measure announced by the
Finance Minister what stands out is the introduction of RoDTEP -
Remission of Duties for Export Products - to replace the existing Merchandise
Export from India (MEIS) scheme. The minister added that revenue foregone as a
result of RoDTEP implementation would be Rs 50,000 crore. The new scheme will
replace the old one from January next year, and this time-frame of over 3 months
is likely to help exporters gradually move to the new system.
Other measures include expanding of scope
of Export Credit Insurance Scheme to offer higher insurance cover
to exporters, digitisation of the entire process of export clearances, formulation
of an action plan to reduce the time to export, support to the sector to help it
best exploit the advantages of the various FTAs, increasing the testing and
certification infrastructure in the country, and enforcing a time-bound
adoption by industry of all necessary mandatory technical standards.
The above measures are welcome. In addition, the Finance
Minister announced that additional 36,000-68,000 crore will be released for
Ministry of MSME to ensure higher credit availability for exports. The sector with
poor credit access will definitely benefit from this move. Similarly, the
decision to held Dubai-like mega shopping festivals could be a boon for our
small businesses. Also, the replacement of MEIS by RoDTEP is a positive step
toward making our export incentives WTO-compliant.
I invite your opinions.