Exporters get fresh incentives

“To boost export we will provide fiscal incentives to several new products and will expand focus of exports to main countries by including China and Japan,” Commerce Minister Anand Sharma told newspersons here on Tuesday.

These fiscal incentives, which will be effective from Wednesday, will cost the national exchequer in the range of Rs 450 crore and Rs 500 crore, he said.

“This amount will be met out of the fund already allocated to Commerce Ministry in the Budget 2009-10. So, as such there will be no additional burden on the exchequer,” he said.
As many as 112 new products will now be eligible for benefits at the rate of 2 per cent of Freight on Board (FOB) value of exports to all markets. These 112 new products include major sectors like engineering, electronics, rubber, chemicals and plastics. Similarly as many as 113 new products will be given higher benefits at the rate of five per cent of FOB value of exports under special Focus Product Scheme (FPS) on exports to all markets. Major sectors include hand tools, parts of agriculture and horticulture machinery and sewing machines.

Under the New Products and New Markets under Market Linked Focus Product Scheme (MLFPS) the government decided to allow as many as 1,837 new products for benefits at the rate of two per cent of FOB value of exports to specified markets. These 1,837 new products fall under major sectors like machine tools, earth moving equipments, transmission towers, electrical and power equipments, auto components and three-wheelers.

Sharma said the Commerce Ministry would recommend to the Finance Ministry for continuation of ongoing stimulus packages for various exports sectors including ongoing interest subvention of two per cent provided to labour incentive sectors.