Budget to target export sops

At present, the system is such that a single exporter can simultaneoulsy avail of half a dozen schemes/sops/rewards. Including the notional revenue foregone, these schemes are estimated to cost the exchequer a whopping Rs 50,000 crore, which, according to the finance ministry, could be reduced drastically.

Finance minister P Chidambaram would also like to undertake a major rationalisation of export schemes. He wants the export schemes/incentives to be structured afresh. Many schemes could be scrapped. The aim is to bring transparency to the whole system.

As a prelude to the exercise, the Cabinet secratariat on Monday held a meeting of the secretaries concerned 8212; KM Chandrasekhar revenue, Adarsh Kishore expenditure, SN Menon commerce and Ashok Jha economic affairs.

8216;8216;The idea is to clearly prescribe the benefit,8217;8217; said the official. What is being attempted now is to examine whether a figure as percentage of net forex earned can be put as maximum benefit for exporters.

Stating that the rationalisation exercise could be a long-drawn affair, the official said a beginning would certainly be made in the Budget. 8216;8216;We are approaching the issue very seriously,8217;8217; he said.

At present, the duty remission schemes for exporters allegedly allow 8216;8216;double benefits8217;8217;. For example, the duty drawback schemes for raw materials, and the duty relief on capital goods under the EPCG scheme can be availed of over and above each other. The export obligations under the two schemes are discharged separately, but the same quantum of exports would qualify for fulfilling both the obligations.