New Delhi: While asserting that inflation was under control and that there were clear signs of revival of industrial production, Finance Minister Nirmala Sitharaman on Saturday laid down a 12-point formula for boosting exports ranging from enabling the handicrafts industry to effectively harnessing e-commerce for exports to hosting mega-shopping festivals.
Key among the measures announced by her was the extension of the schemes of Reimbursement of Taxes and Duties for Export Promotion (RoDTEP). “The scheme for Remission of Duties or Taxes on Export Product (RoDTEP) will replace MEIS. The existing dispensation in textiles of MEIS and the old ROSL will continue till December 31, 2019,” she said, adding that sectors such as textiles that currently enjoy incentives of up to two per cent over MEIS "will transit into RODTEP from January 1, 2020”. She added, “In effect, RODTEP will more than adequately incentivise exporters than existing schemes put together. The revenue forgone is projected at up to Rs 50,000 crore.”
Sitharaman also said the government would be implementing a fully automated electronic refund route for Input tax Credits (ITC) in GST by the end of September 2019. "Fully electronic refund module (FORM GSAT RFD-01) for quick and automated refund of ITC nearing completion and will be implemented by the end of September 2019. This is expected to monitor and speed up ITC refunds."
The FM added that the government was expanding the scope of export credit insurance scheme by Export Credit Guarantee Corporation (ECGC). She said, “ECGC will expand the scope of ECIS. This will offer higher insurance cover to bank lending working capital for exports. While premium incidence for MSMEs will be moderated suitably. It is expected that the initiative will cost about Rs 17,000 crore per annum. This will enable reduction in overall cost of export credit including interest rates, especially to MSMEs."
She added, "Priority sector lending (PSL) norms for export credit have been examined and enabling guidelines under consideration of the RBI. This will release an additional Rs 36,000 crore to Rs 68,000 crore as export credit under priority sector."
Sitharaman said effective monitoring of export financing would be handled by the department of commerce. "Date on export finance is regularly published by the RBI. Export finance will be actively monitored by an inter-ministerial working group in the department of commerce, tracked through a dashboard, reviewed with institutions and active intervention will be carried out."
The government would also "leverage technology to reduce 'time to export' or 'turn-around time" through the "timely completion of ongoing initiatives to further reduce 'time to export' - through seamless process digitisation of all export clearances (port/airport/customs) etc and elimination of offline/manual services."
An action plan to further this in airports and ports, bench-marked to international standards will be implemented by December 2019."Actual turn-around times will be published in real time for each port and airport to push them to improve performance," she added. "Annual mega shopping festivals in India will be organised in four places” in March 2020 for handicrafts, yoga, tourism, textiles and leather, she added.
The government also announced a "Free Trade Agreement (FTA) utilisation mission" headed by a senior official in the department of commerce. This, the FM said, will "work exclusively with FIEO and export houses to utilise concessional tariffs in each FTA" and "enhance awareness of preferential duty benefits among MSMEs, disseminate and facilitate compliance requirement (such as Rule of Origin/ Certificate of Orgin etc) under FTAs for importers and exporters."
To further improve the ease of doing business and exports, she announced an online origin management system in the coming weeks for exporters to enable them to "obtain certificates of origin (CoO) under rules of origin".
The FM also stressed on the "time-bound adoption of mandatory technical standards" for an expected boost for enabling Indian products to overcome non-tariff barriers in exports. She said that the government would work towards the "time-bound adoption of industry of all necessary technical standards and their effective enforcement to elevate the quality and performance of ecosystem, enhance competitiveness and address the issue of sub-standard imports."
She added that a working group on standards will be set up in the department of commerce to "work with industry to lay a roadmap for adoption of standards, time lines and enforcement." The FM said affordable testing and certification infrastructure would "be adequately expanded and developed in PPP mode to enable exporters to get all internationally accepted tests and certificates done within India" and that this would "reduce cost of adoption of standards and certification for Indian exporters to meet standards of FTA partners."
Finally, the FM said that the government would work towards enabling the "handicrafts industry to effectively harness e-commerce for exports" through the "special dispensation for facilitating an on-boarding handicrafts artisans and handicraft cooperatives directly on e-commerce portals and enable seamless exports" and that the mass enrolment of artisans across India would take place to facilitate this.