NEW DELHI, March 7: The commerce ministry has constituted a panel to evaluate the value-addition criterion made applicable to judge the performance of hundred per cent export-oriented units (EOUs) and submit its report. The panel is headed by Noida Export Processing Zone development commissioner A K Kundra and additional secretary in the commerce ministry.Currently, the performance of EOUs is measured in terms of value addition/net foreign exchange earning (NFEE) as a percentage of exports. In addition, the units are subjected to export obligation which is not below the minimum norms stipulated for different products in the 1997-2002 exim policy. In the case of domestic exporting units, they are under no obligation to achieve any prescribed value-addition norms or specified minimum quantity of exports. The move to constitute the committee decided upon at a recent meeting in the commerce ministry comes in the wake of representations from EOUs that the currency turmoil in south-east Asia has had the effectof blunting their competitive edge in these countries.The value-addition/NFEE norms were introduced for the first time in the current policy to evaluate the performance of EOUs. Prior to that, the yardstick applied for the purpose was on the basis of export of 70 per cent of production value. The Confederation of hundred per cent Export-oriented Units (CEU) has been urging the government to judge the performance of EOUs on the basis of net forex and once that is achieved, no other stipulation should apply.
