Exim policy to get saffron coating

This along with other modifications in the policy under consideration in the commerce ministry will be forwarded to the new commerce minister for approval after being sworn along with other ministers in the BJP council of ministers on Thursday.

If the new commerce minister has his or her way, the 10 per cent countervailing duty on capital goods under the zeroduty scheme may also be removed. The levy imposed a few months ago has been adding to the burden of exporters The threshold limit under the above scheme was scaled down to Rs 5 crore in the case of hundred per cent export-oriented units in the agriculture, horticulture, floriculture, pisiculture sectors when the exim policy was announced on April 1 last year.

The facility of importing second-hand capital goods under the scheme is likely to be discouraged if not dispensed with as experience of the working of the scheme shows that exporters have been importing moistly new machinery items. Procedures governing the duty-free advance licence scheme in operation for a number of years will also be considerably simplified so that exporters receive licences in about a week as against 2 months to six months at present.

In respect of the EOUs and units set up in the export processing zones, the proposal is to remove strangehold of controls and eliminate the inspector raj and to rely only on post-audit.

The EOU/EPZschemes have been in operation allow the units to sell 25 per cent of their production value in the domestic market subject to customs or excise duties whichever is higher. In actual practice however, DTA sale has been few and far between.

In this background, the commerce ministry is taking a hard look at the DTA sale, which it feels is conceptually wrong as the EOUs/EPZs are supposed to export hundred per cent of their production. It is however recognised that the facility is mainly intended to meet adverse world trading conditions due to fast changing technology and the DTA sale is to act as a cushion for the units. The process of formulating standard input-output norms under the duty entitlement passbook scheme to cover new export products is already under way and the new credit rates for these products are expected to be announced on April 1.