Export promotion schemes face axe

NEW DELHI: The government on Wednesday indicated that some export promotion schemes that have outlived their utility may be scrapped. Commerce secretary GK Pillai said schemes of marginal use and low utility would be done away with in the annual review of the foreign trade policy this year.

He said exports were certain to hit the $150-billion mark this year, and may even touch $155 billion, just falling short of the $160-billion target for the year. “Exports worth $150 billion are certain this year. If there is a surge, shipments could even go up to $155 billion,” Mr Pillai told reporters on the sidelines of a CII meet on Foreign Trade Policy. He added that an export target of $200 billion for fiscal year 2008-09 seemed feasible.

Clarifying that the schemes to be put on the chopping block are yet to be identified, the commerce secretary pointed out that incentives such as the export promotion capital goods scheme (EPCG) spelt more trouble for exporters, with minimal benefits. He said every year, several exporters received notices for failing to meet export obligations.

Mr Pillai sought inputs from the industry for the Krishnamurty committee, which is likely to submit its report to Prime Minister Manmohan Singh on January 31. The committee is examining ways to help export-oriented manufacturing sectors such as textiles, leather and handicraft, which are suffering from a slowdown in growth.

The commerce ministry would submit its first draft of the trade policy to the revenue department within 10 days, Mr Pillai said. India’s exports for April-November 2007 amounted to $98.38 billion, growing at 22.08% over the previous year.