50 items lose DEPB benefit

The government has withdrawn the benefits of the Duty Entitlement Passbook (DEPB) scheme from nearly 50 items, including steel, cement and certain mineral ores.

The move is aimed at discouraging export of these items, increase their availability in the domestic market and ease prices. This is the latest in a series of steps taken by the government to check rising industrial commodity prices. Inflation has touched a 13-week high.

The Directorate General of Foreign Trade (DGFT) notified these change to the DEPB, a popular duty remission scheme, on Thursday night. The benefits have also been withdrawn from non-basmati rice, manganese, ferrous and chrome.

In another step to increase the availability of rice in the country, the government has also increased the minimum export price for basmati rice to $1100 per tonne (Rs 44,000 per tonne).

“The total number of items on which the DEPB benefits have been withdrawn will run into 40-50. When there is a shortage of steel in the country, why give export incentives? Prices of steel are very high at the moment. Moreover, we do not want cement prices to go up. Anyway, there is hardly any export of cement taking place. We are importing cement at zero duty,” Commerce Secretary GK Pillai said on the sidelines of a Ficci function .

Meanwhile, Commerce Minister Kamal Nath said his ministry would recommend scrapping of import duty on steel, whose rising prices have contributed significantly to recent surge in inflation.