The Government is likely to hand out sops worth over Rs 4,000-crore to exporters to help them cope with uncertainties in the developed market and the low global demand.
Cash benefits for exporting identified products to chosen markets, discounts on bank interest rates, an amnesty scheme giving more time to units to meet their export obligation, and a package for Special Economic Zones are expected to form part of the annual supplement to the Foreign Trade Policy (FTP).
The FTP is set to be announced by Commerce Minister Anand Sharma on Thursday.
“Falling exports and the growing deficit in the trade and current accounts are a big worry for the economy. Attempts have been made in the FTP to ensure that exports get a boost and grow steadily in the current fiscal,” a Commerce Department official told
Export growth in 2012-13 is likely to be lower than in the previous year despite a small increase in January and February. Eight straight months of decline in exports between May and December led to a 4 per cent fall in exports in the April-February period, to $265.95 billion.
With imports in the same period growing marginally at 0.25 per cent to $448.04 billion, the trade deficit, the gap between imports and exports, increased to $182.1 billion from $169.8 billion last year.
To ensure that exporters in SEZs do not get left out, units in such zones are likely to benefit from the Focus Product and Focus Market schemes. These have so far been restricted to exporters outside the zones.
The scheme offers duty-free import scrips to exporters of identified products and for exporting to specific markets that can be sold to others for cash.
A separate policy for SEZs, which is likely to be announced simultaneously with the FTP, will also ease operational rules, including lowering the minimum area and contingency requirements for both multi-product and sector-specific SEZs.
The Commerce Department may also give in to a demand that high-performing exporters designated as status-holders be allowed to trade the benefits accruing to them, including import duty discount.
With the Government’s revenue collections on target and resources less of a constraint this year, the FTP is expected to be more ambitious in its coverage.
Popular markets of Brazil and South Africa, so far not included in the Focus Market schemes due to resource considerations, may get covered. High-value products such as gems and jewellery and certain engineering goods may get included under the interest subvention scheme and the level of discount may also be increased from the current 2 per cent.