Pending duty drawback claims to hurt SME exporters most: FIEO
Updated: Dec 17, 2013 04:07:48pm
New Delhi, Dec 17 (KNN) Raising concern over the pending duty refund claims of more than Rs 4,800 crore in the past couple of months, exporters body Federation of Indian Export Organisations (FIEO) said that SME exporters would be worst hurt due to this.
“We have been requesting the customs authorities to clear the claims but they do not seem to be responding. They appear to be more concerned about meeting their revenue targets,” FIEO President Rafeeque Ahmed told reporters here yesterday.
He also said that liquidity is a big issue for exports and pending claims of refund of service tax, duty drawback, rebate claims and VAT are affecting exports.
“At present, out of 118 ports, in 103 ports duty drawback claims alone are pending to the tune of Rs. 4,821 crore as against the normal pendency of Rs. 1,000 crore or less,” Ahmed said.
“They (customs authorities) are simply saying that they cannot do anything. For them, their revenue target is more important,” he added.
If the claims continue to rise like this “India may not be able to achieve the desired growth in exports”, he said.
The government is expecting a growth rate of 10 per cent in exports during the 2013-14 fiscal and has fixed a target of USD 325 billion from overseas shipments.
Ahmed said that at Jawaharlal Nehru Port, duty refund claims of Rs 1,593 crore are pending.
In Chennai seaport alone, drawback claims to the tune of Rs 802 crore are pending and in Calcutta sea ports they are at 270 crore.
“SME exporters would be worst hurt due to this,” he said.
He said VAT claims in states such as Bengal, Punjab, Tamil Nadu and Maharashtra were very high.
In case the claims continue to rise like this “India may not be able to achieve the desired growth in exports”.
Further, FIEO said that the major challenge lies at home where manufacturing is not back on track.
“After four months of modest IIP growth, we witnessed negative growth in October. I would like to reiterate that exports cannot be sustained even on medium term basis unless manufacturing backs exports,” said the FIEO chief.
There is need to push manufacturing by augmenting investment in the sector both for modernization and expansion. The new Manufacturing Policy and new Investment and Manufacturing Zone should be given thrust to achieve this objective,” he added.
The exporter’s body was for transaction cost to be reduced through ongoing improvements.
“Even 50 per cent reduction in transaction cost can provide 12-15 billion dollar to export sector without any cost to exchequer. The Trade Facilitation Agenda has provided us an opportunity to quickly address the same for imparting competitiveness to our exports,” FIEO said.
Speaking about the basic problems related to the infrastructure issues, FIEO said that quality power at competitive rates, efficient port operations, adequate testing and tool room facility at export clusters coupled with aggressive marketing will help them achieve their long term objective set for 2020.
The general forecast is that 2014 will be a better year than 2013.
He said the global situation is still very fluid with only a few green shoots and it will continue to be uncertain throughout 2014.
Exports increased 5.86 per cent to USD 24.6 billion in November, the slowest in five months, as shipments of petroleum goods and rough diamonds decreased. In April-November, exports grew 6.27 per cent to USD 204 billion, while imports stood at USD 304 billion. (KNN/SD)
“We have been requesting the customs authorities to clear the claims but they do not seem to be responding. They appear to be more concerned about meeting their revenue targets,” FIEO President Rafeeque Ahmed told reporters here yesterday.
He also said that liquidity is a big issue for exports and pending claims of refund of service tax, duty drawback, rebate claims and VAT are affecting exports.
“At present, out of 118 ports, in 103 ports duty drawback claims alone are pending to the tune of Rs. 4,821 crore as against the normal pendency of Rs. 1,000 crore or less,” Ahmed said.
“They (customs authorities) are simply saying that they cannot do anything. For them, their revenue target is more important,” he added.
If the claims continue to rise like this “India may not be able to achieve the desired growth in exports”, he said.
The government is expecting a growth rate of 10 per cent in exports during the 2013-14 fiscal and has fixed a target of USD 325 billion from overseas shipments.
Ahmed said that at Jawaharlal Nehru Port, duty refund claims of Rs 1,593 crore are pending.
In Chennai seaport alone, drawback claims to the tune of Rs 802 crore are pending and in Calcutta sea ports they are at 270 crore.
“SME exporters would be worst hurt due to this,” he said.
He said VAT claims in states such as Bengal, Punjab, Tamil Nadu and Maharashtra were very high.
In case the claims continue to rise like this “India may not be able to achieve the desired growth in exports”.
Further, FIEO said that the major challenge lies at home where manufacturing is not back on track.
“After four months of modest IIP growth, we witnessed negative growth in October. I would like to reiterate that exports cannot be sustained even on medium term basis unless manufacturing backs exports,” said the FIEO chief.
There is need to push manufacturing by augmenting investment in the sector both for modernization and expansion. The new Manufacturing Policy and new Investment and Manufacturing Zone should be given thrust to achieve this objective,” he added.
The exporter’s body was for transaction cost to be reduced through ongoing improvements.
“Even 50 per cent reduction in transaction cost can provide 12-15 billion dollar to export sector without any cost to exchequer. The Trade Facilitation Agenda has provided us an opportunity to quickly address the same for imparting competitiveness to our exports,” FIEO said.
Speaking about the basic problems related to the infrastructure issues, FIEO said that quality power at competitive rates, efficient port operations, adequate testing and tool room facility at export clusters coupled with aggressive marketing will help them achieve their long term objective set for 2020.
The general forecast is that 2014 will be a better year than 2013.
He said the global situation is still very fluid with only a few green shoots and it will continue to be uncertain throughout 2014.
Exports increased 5.86 per cent to USD 24.6 billion in November, the slowest in five months, as shipments of petroleum goods and rough diamonds decreased. In April-November, exports grew 6.27 per cent to USD 204 billion, while imports stood at USD 304 billion. (KNN/SD)
Loading...
