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FIEO welcomes hike in export incentives

Coming on the back of mid-term review of the foreign trade policy, the increase would bring in additional Rs 2,743cr for exports development.

, ET Bureau|
Last Updated: Dec 05, 2017, 09.16 PM IST|Original: Dec 05, 2017, 09.12 PM IST
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The FIEO president said, “The 2% increase in the MEIS rates for labour-intensive sectors and services will provide much needed respite to these sectors which  are facing huge competitiveness from other countries”.
The FIEO president said, “The 2% increase in the MEIS rates for labour-intensive sectors and services will provide much needed respite to these sectors which are facing huge competitiveness from other countries”.
HYDERABAD: The Federation of Indian Export Organisation (FIEO) has welcomed the Union government’s move to increase the incentives under merchandise export from India scheme (MEIS) to 2%, calling it a ‘much needed respite’ to labour-intensive sectors that were reeling under competition from other countries.

Coming on the back of mid-term review of the foreign trade policy, the increase would bring in additional Rs 2,743 crore for exports development.

Ganesh Kumar Gupta, president, FIEO said, “The 2% increase in the MEIS rates for labour-intensive sectors such as leather, carpets, handicrafts, tools, marine, medical and scientific products and services such as accountancy, architecture, legal, education, hotel and restaurant will provide much needed respite to these sectors which are facing huge competitiveness from other countries”.

However, he called for gradually extending the MEIS to other sectors of exports since they are also facing numerous challenges in exports.

“A one-time relaxation to meet Export Obligation may be provided to the industry so that they can escape the penal provisions, which will be disruptive and will provide an opportunity to add to exports besides providing employment,” said Gupta in a statement on Tuesday.

The Association also said that the creation of new logistics division in the Department of Commerce and Industries and the decision to develop National Logistics Information Portal for online logistics market players will go a long way to reduce the logistics cost in India which will also be supplemented by the initiative on Trade Facilitation Agreement and e-Way Bill introduction under the Goods and Services Tax (GST).

Meanwhile, the association also laid thrust on boosting agricultural exports. “A new agricultural export policy is the need of the hour to provide a stable market and open exports for long term,” said Gupta, adding, India should take a lead in organic exports and encourage states to get them certified as organic as has been done by Sikkim already.

Further, the Association said that procedural simplification to replace IEC by PAN; increase in the validity of the scrips from 18 months to 24 months; reintroduction of ARO facility for supply against Advance Authorization/EPCG/EOU; relaxation in export of free of cost samples from 1% to 2% of average exports in preceding three years with a ceiling of Rs 2 crore would also mitigate the hardship of the exporters and hassles related to its compliances.

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