banking
overview
| news
| basics
|
lendings
|advanced banking
| products
| IT
in banking
articles
& policies |
banking software|
deposits|
bank directory|
internet banking|
bank results|
banking & you
EXIM POLICY 2003-2004
[Full Text of the speech delivered by Hon’ble Commerce & Industry
Minister on the 31st March 2003]
PAGE 2
SEZs
Let me now turn to my next engine for growth viz. the SEZ scheme. We have great hope for attracting Foreign Direct Investment and increasing our export through this scheme. SEZs are required to provide a trouble free congenial and investment friendly environment where units, both Indian and foreign can manufacture their products at internationally competitive prices for exports or sale to domestic tariff area. Though most of the notified green field projects have not yet got off the ground due to delay in land acquisition, the Indore SEZ is very close to coming into operation. It is important to realize that unless we convince the potential investors that location in these SEZs can give them competitive edge over similar units in other countries, we shall not be able to attract any worthwhile investment. Therefore, our endeavor will be to bless our SEZs with facilities comparable to those obtaining elsewhere in the world. To enable exporters to access funds at international rates, we are inh consultation with RBI and Finance Ministry for a suitable fiscal package for off-shore banking units (OBUs) set up in SEZs.
All the Ministries and agencies of Government of India as well as the concerned State Governments will have to work unitedly with a shared vision for the success of SEZ programme. While we shall continue our efforts including bringing in a comprehensive legislation, we will simultaneously explore the possibility of developing a scheme with features similar to the SEZ regime, for Export Oriented Units in selected sectors with capital investment in plant and machinery over Rs. 25 crores.
EPCG SCHEME
16. I would like all of you to appreciate the fact that our growth in exports in the recent past has taken place in the background of a somewhat slow down at home. Since we are aiming to be a significant player in the world trade, we have to build up deliberately and quickly the manufacturing base in order to sustain a high rate of growth of exports. The EPCG Scheme has contributed significantly to exports by facilitating expansion of the manufacturing base with limited gestation period and at a comparatively lower capital investment. We recognize that the long term solution for the building up of a competitive manufacturing base would be to bring down the levels of import tariff on capital goods comparable to those prevailing in the countries which are considered as our competitors. Till that happens, EPCG Scheme will have to be continued. At the same time, we have to make it more flexible and attractive so that even the small scale sector is able to set up and expand its manufacturing base for exports. We have, therefore, decided to take the following steps :-
(i) The Scheme will now be more flexible and allow import of capital goods for pre-production and post production facilities also.
(ii) Export obligation will be rationalized by linking it to duty saved. The export obligation would now be 8 times the duty saved. All other conditions will remain unchanged.
(iii) In order to facilitate upgradation of existing plant and machinery, import of spares will be allowed under the Scheme subject to the same conditions. Consequently, the condition of allowing only 20% of spares along with the import of capital goods becomes redundant.
(iv) In order to facilitate higher value addition in exports, the existing condition of increase in Export Obligation by 50% in case of export of a product higher up in the value chain is being done away with.
(v) In order to give flexibility in fulfillment of Export Obligation, a manufacturer exporter would now be permitted flexibility to fulfill his obligation through any other product being manufactured by him. This is being done to allow for changing conditions in the international market in which the export of a particular product may not be remunerative or feasible at a particular point of time. This facility will be subject to the condition that average export of the substitute product will be taken into account in fixing the revised export obligation. The facility will be confined to the products being manufactured by the same company/ legal person.
(vi) In line with the general policy, capital goods upto to 10 years old will be allowed under this scheme.
(viii) To facilitate diversification into software sector, existing manufacturer-exporters will be allowed to fulfill export obligation arising out of import of CG under EPCG Scheme for setting up of Software units through export of manufactured goods of the same company.
EXPORT OF ELECTRONIC HARDWARE
17. Export of electronic hardware is going to be one of our major thrusts. In order to give a boost to the export of electronic hardware, we are modifying the EHTP Scheme to allow counting of all 217 ITA-I items by EHTP units to DTA units for fulfillment of their export obligation. Similarly, in the software sector, procedure and formalities applicable to status holders amongst STP units will be greatly simplified. This should facilitate free movement of laptop, computer and other professional equipments and provide required flexibility to the software professionals.
18. To promote the growth of software exports in the area of embedded programs, procedure for the import and re-export of the hardware including automobiles in which such programmes are embedded for testing and development will be greatly simplified in consultation with Ministry of Finance. Henceforth such hardware for embedding upto the value of U.S. Dollar 10,000 will be allowed to be imported duty free and permitted to be disposed of after testing subject to certification by Software Technology Parks India (STPI). In order to allow both hardware and software sectors to remain up-to-date in sectors with high rate of obsolescence, accelerated rate of depreciation will be allowed in conformity with accepted international practice. Similarly, procedural formalities governing donation and destruction of obsolete hardware and inventory will be simplified.
Back to Page 1 of EXIM POLICY 2003-04
Click for Page 3 of EXIM POLICY 2003-04
copyright
banknetindia.com All rights reserved worldwide.