Exports from SEZs down by 45 per cent till June: EPCES

New Delhi, Sep 4 (KNN) Export Promotion Council for EOUs and SEZs (EPCES) on Friday said that the manufacturing exports from Special Economic Zones (SEZs) have suffered a lot and decreased by about 45 per cent till June this year to Rs 41,699 crore from Rs 75,346 crore last year.

EPCES said this during a meeting with the Commerce and Industry Minister with Export Promotion Councils (EPC) held on Thursday adding, ''Software & Service Exports have grown only marginally by 5 per cent to Rs 1,11,245 crore till June 2020 from Rs 1,05,279 crore last year.''

EPCES also raised the issues relating to SEZs and Export Oriented Units (EOUs) in the meeting.

The representatives also apprised the Minister of their export performance of their respective sectors and raised the sectoral issues. On behalf of the Export Promotion Council for EOUs and SEZs (EPCES), Bhuvnesh Seth, Vice Chairman and Alok Chaturvedi, IAS (Retd), Director General, presented the issues related to EOUs and SEZs.

Seth suggested that as part of “Atmanirbhar Bharat”, in order to check imports, SEZ and EOU units should be allowed to manufacture these goods and supply them to domestic market without any import duties.  At present import duties are imposed on all supplies from SEZ units to Domestic market.  This will help in strengthening “Make in India” and “Atmanirbhar Bharat” initiatives of Prime Minister and in import substitution.

''These imported goods may include defence products, health products and other non-essential goods, which can be identified. In fact, these goods manufactured in SEZ and EOUs and supplied to the domestic market should be treated as exports as import substitution is as good as exports. Goods will be manufactured in India and jobs will be created in India,'' EPCES said in a statement.

 However, Chaturvedi, DG, EPCES raised the following key issues facing the exporters of SEZs and EOUs:

---  1. There is an uncertainty about incentives under Merchandise Exports from India Scheme (MEIS) for the period from 1.4.2020 to 31.8.2020 which should be resolved immediately. The recent notification issued by DGFT is silent on this aspect.

---  2.The fixation of rates under the new scheme of Refund of Duties and Taxes on Exported Products (RoDTEP) may take some time. Lot of data has to be collected and to be given by EPCs and then examined by the recently constituted RoDTEP Committee. Rates may be announced only by the end of December, 2020. Therefore, there is an uncertainty about the rates, post MEIS. It will be difficult for the exporters to properly price their products now which would be exported post 31.12.2020. They need at least 3 months advance time for the exports. Therefore, even if the rates are available by December 2020, MEIS should continue till 31.3.2020. This will give certainty for the exporters about the benefits.

---  3. Incentives under the SEIS (Service Exports from India Scheme) for the exports made during 2019-20 and this financial year are still unresolved.  This issue may also be resolved at the earliest.

---  4. In order to boost domestic manufacturing and check imports, there should be exemption from 5% Health Cess on medical devices manufactured in SEZ/EOU units and supplied to the domestic market.

---  5. Export of Non-medical NBR Gloves should be made free. Units in SEZ are facing closure while non-medical industrial NBR Gloves are not needed for the purpose of COVID. At present exports of all NBR gloves including industrial gloves are banned.

---  6. Manufacturing units in SEZs should be exempted from payment of lease rental. Their exports are down by 45% till June 2020. They are in deep trouble during this difficult period. These charges are levied by SEZ authorities under Development Commissioners.  Further, Development Commissioners should be asked not to issue eviction notices for default in payment of arrears.

---  7. SEZ online should be integrated with ICEGATE system of customs. Further, the government should bear charges for SEZ online on the pattern of ICEGATE. SEZ exporters should not be charged fee for transaction in SEZ Online as exporters/importers are not charged when they use ICEGATE.

---  8. Job work by SEZ units for units in the domestic area should be allowed.  This will help in utilizing unutilized capacities with SEZ units during slack season.

---  9. MEIS/ROSTL benefits should be extended to apparel/ garment sector for exporters in SEZ /EOUs

---  10. There should be a system of sharing with EPCs about the progress on issues identified.

Goyal exhorted the EPCs to put their maximum efforts for increasing exports. He also assured that all the issues raised by the EPC have been noted and the progress will be reviewed in the next meeting within a month.