Facilitate handicraft exports for speeding growth: EPCH to DGFT

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SME Times News Bureau | 29 Feb, 2012
Export Promotion Council for Handicrafts (EPCH), a nodal agency for promotion and export of handicrafts, Tuesday raised the important issues with Director General of Foreign Trade (DGFT) for speeding growth in handicrafts exports.

Arvind Vadhera, Chairman, EPCH and Rakesh Kumar, Executive Director-EPCH Tuesday met Dr. Anup K. Pujari, Director General of Foreign Trade for discussions on measures to be taken by the Government to facilitate and increase the growth in exports of handicrafts items.

The Executive Director apprised the DGFT about the export performance indicating the exports growth during the last 10 months and also the activities and initiatives taken by the Council during the current financial year towards export promotion. The growth rate can be sustained and further accelerated by the handicrafts exporting community, if the Government considers certain issues for facilitating exports, he added

Vadhera raised the issues one by one and pointed out that the list of focused products already announced by the DGFT presently covers handicrafts items on which 7 percent duty credit scrip is allowed. He also suggested that the limit of 7 percent needs to be raised to 10 percent.

The Government till 1993 had a policy of Deemed Exports under which sale of handicrafts items to foreign tourists made in foreign exchange was treated as exports which also had helped in selling more and more items to foreign tourists enabling them to buy exclusive items products from producers directly.

For the last many years this scheme has not been in operation, the Council recommended to the DGFT that the scheme of Deemed Exports, particularly in case of handicrafts products, should be reintroduced so that the exporters can sell their products to foreign tourists against foreign exchange and add the same to their export performance.

The Government already has a scheme for Duty Free Import of Embellishment and Trimmings and Tools to the extent of 5 percent of the total export performance of the exporters in the previous year. The list of trimming, embellishment and tools presently allowed for duty free import is restricted to about 27 items. Though, the scheme has been useful in helping the exporters in producing export quality goods, yet it has been experienced that many more items need to be added to this list to enable to achieve faster rate and better quality of production.

EPCH has, therefore, recommended that a residual entry may be added to the list wherein any additional item recommended by the Council or Office of DC(H) may be included to this list of trimmings, embellishments and tools for duty free import in the parameters of 5 percent of export performance of the exporters in the previous year.

Further, the issue of continuation of interest subvention of 2 percent for handicrafts sector beyond 31st March 2012 was also taken up. The waiving of Service Tax in relation to business exhibition organized within India was also sought, since the exhibitions organized by the Council in India are exclusively B2B shows.

EPCH Chairman also raised many other important issues with DGFT some of these related to the Port of Registration for making single consolidated application; permission for import of samples of Indian origin as part of passenger baggage; withdrawal of increase in processing fees of certificate of origin for India’s exports under GSP; Credit card as export payment mode; liberalization under MDA scheme; waiving of Service Tax on Membership Fees of Councils; inclusion of Narsapur and Saharanpur in the list of Towns of Export Excellence (TEE).

EPCH got a very patient and encouraging hearing from the DGFT who assured proper examination of the issues raised by Council for implementation in the near future.

Handicrafts exports in the first 10 months registered an increase of 23.44 percent at Rs. 8992.12 crore of the current financial year 2011-12 as against Rs. 7284.48 crore during the same period last year and in dollars terms the exports went up by 18.91 percent at USD 1889.61 million in the first 10 months of 2011-12 as against 1589.17 million dollars during the same period in 2010-11.