From Sumit Kumar
 
New Delhi, April 18 (KNN) Commerce and Industry Minister Anand Sharma today unveiled the much-awaited Foreign Trade Policy (FTP) extending  interest subsidy of two per cent to  textiles and  engineering goods besides giving the duty free import entitlement under the Export Promotion Capital Goods (EPCG) scheme to all the sectors.
 
However, the annual supplement to the FTP , fell short of exporters’ expectations . President of the Federation of Indian Export Organisations (FIEO) M Rafeeque Ahmed, said , “ it is not a big-ticket policy ….we expected more on the market front…there is nothing for the MSME(micro,small  and medium enterprises)”.
 
Unveiling the policy , Sharma also released the data for the full financial year 2012-13, which showed exports barely managed to reach USD 300 billion while imports went up by a higher pace leaving a huge trade deficit of USD 190 billion.
 
“Last year has been an extremely difficult one for the global economy and the challenging economic situation in Euro Zone continues unabated.  Recovery in United States is weak and in this environment it has been a difficult task for our exporting community.  The World Trade Organization in its latest report has revised the global trade growth projections downwards from 3.7 per cent  to 2.5 per cent which is less than half of the previous 20 years average.  This is indeed a disturbing trend,” Sharma said while releasing the policy.   
 
The interest subvention scheme under which exporters get credit at two percentage points lower rates was earlier available to handloom, handicraft, carpets, toys, sports goods and process agri products. It has now been extended to  a select engineering goods and textile items like made-ups. The engineering goods is among the major contributor to the export basket. 
 
Addressing the media and exporters, Sharma said, the government wants to see exports grow but under the given circumstances, there are limitations.
 
As many as 126  products have been added to the Focus Product Scheme and the incremental exports scheme extended to 53 more nations.
 
Exports of high-tech items would also be incentivised . Morbi town in Gujarat and Gurgaon in Haryana have been added to the existing list of towns of export excellence for ceramic tiles and apparel exports respectively.
 
These towns will be eligible to get benefit under the ASIDE (Assistance to States for Development of Export Infrastructure and Allied Activities (ASIDE) scheme.   
 
There has also been an effort for import substitution. Exporters who obtain capital goods from the domestic sources instead of imports for making their finished products will also get some concessions.
 
 The measure will help the domestic manufacturing and reduce import dependence.  
 
Besides, the policy has also relaxed the Special Economic Zones (SEZs) scheme for the specific sector and multi-sector zones.
 
However, the industry wanted the Minimum Alternate Tax (MAT) to go, which has not been done, as the Finance Ministry is opposed to the idea of making SEZs totally tax-free.
 
But, the transfer of ownership of SEZs has been made easy even as critics had said that this would encourage developers to build real estate and not the real manufacturing activity.
 
Going ahead, the exports prospects look challenging but there could be hope of revival in the US and the European markets if some of the problems in the troubled debt-ridden countries are resolved.
 
A sharp correction in commodity prices which impact the cost of raw material for the manufacture exports, also holds some hope.  (KNN)