Centre brings new policy to increase exports

New Delhi, Mar 10 (ANI): The Central Government has revised its foreign trade policy to increase exports in labour intensive engineering goods.

Replying to a question in the Rajya Sabha, Union Minister of State for Commerce and Industry Jyotiraditya Scindia, said the Centre has announced incentives for labour intensive engineering goods under the reward and incentive schemes in the Foreign Trade Policy (FTP) 2009-14.

According to the new policy, 12 new products added under Focus Product Scheme (FPS), eligible for incentives in the form of Duty Credit Scrip at two percent of Free on Board (FOB) value of exports to all markets.

The new policy has given higher incentives to 113 new products in the form of Duty Credit Scrip at five percent FOB value of exports under special FPS on exports to all markets.

He informed the Centre has added 1837 new products under Market Linked Focus Product Scheme (MLFPS) eligible for incentive in the form of Duty Credit Scrip at two percent of FOB value of exports to specified markets.

Export of labour intensive engineering goods to 110 countries notified under Focus Market Scheme under FTP is eligible for incentive in the form of Duty Credit Scrip at three percent of FOB value of exports, Scindia said.

Under the Focus Product Scheme, there is a provision that to promote investment in upgradation of technology of specified sectors, additional Duty Credit Scrips shall be given to Status Holders at one percent of the FOB value of past exports.

This facility, in addition to other specified sectors, will also be available for engineering sector excluding iron and steel, non-ferrous metals in primary or intermediate form, automobiles and two wheelers, nuclear reactors and parts, and ships, boats and floating structures.

The duty credit scrips can be used for procurement of capital goods with Actual User condition. Scindia said the facility would be available upto March 2011.

In order to enable access to cheaper dollar credit, the Reserve Bank of India (RBI) has reduced rate of interest for Dollar credit at LIBOR plus two percent instead of LIBOR plus 3.5 percent.

Continuation of Interest Subvention of two percent provided to labour intensive sectors that include the micro, small and medium enterprises (MSME) sector which is the most labour intensive segment of Indian industry. (ANI)