Interest Subvention Scheme to Boost Exports

By | August 4, 2016

Interest Subvention Scheme to Boost Exports

The Government has introduced the Interest Equalization Scheme on Pre and Post Shipment Rupee Export Credit w.e.f. 01.04.2015 for 5 years. The scheme has been notified vide RBI circular No. 62 dated 04.12.2015. The scheme is available to all exports by manufacturers under 416 specified tariff lines [at ITC (HS) Codes at 4 digit level] and exports made by manufacturing Micro, Small and Medium Enterprises across all ITC (HS) Codes. The rate of interest equalisation is 3% per annum.

Government has taken suitable measures to promote exports, which include:

(i) The Merchandise Exports from India Scheme (MEIS) was introduced in the Foreign Trade Policy (FTP) 2015-20 with effect from April 1, 2015. MEIS aims to incentivize export of merchandise which is produced/ manufactured in India.

(ii) The Government has introduced the Interest Equalisation Schemeon Pre & Post Shipment Rupee Export Credit with effect from 1.4.2015. The scheme is available to manufacturers for all exports under 416 specified tariff lines [at ITC (HS) Codes at 4 digit level] and to exports made by manufacturers in Micro, Small and Medium Enterprises across all ITC (HS) Codes. The rate of interest equalisation is 3% per annum.

(iii) Duty Exemption/Remission Schemes viz Advance Authorisation (AA), Duty Free Import Authorisation (DFIA) and Duty Drawback (DBK) Scheme enable duty free import of inputs for export production, including replenishment of input or duty remission. Schemes to promote exports of Gem & Jewellery include Advance Procurement / Replenishment of Precious Metals from Nominated Agencies, Replenishment Authorisation for Gems, Replenishment Authorisation for Consumables and Advance Authorisation for precious metals. Export Promotion Capital Goods (EPCG) Scheme facilitates import of capital goods at zero duty for producing quality goods and services to enhance India’s export competitiveness. Authorisation holder underEPCG is not required to maintain average Export Obligation in respect of export of goods from following sectors viz. Handicrafts, Handlooms, Cottage & Tiny sector, Agriculture, Aqua-culture (including Fisheries),Pisciculture, Animal husbandry,Floriculture & Horticulture, Poultry, Viticulture, Sericulture, Carpets, Coir, and Jute.

(iv) Market Access Initiative (MAI) Scheme is an Export Promotion Scheme envisaged to act as a catalyst to promote India’s exports on a sustained basis. The scheme provides assistance to Export Promotion Organizations/Trade Promotion Organizations/National Level Institutions/ Research Institutions /Universities /Laboratories, Exporters etc., for enhancement of exports through accessing new markets or through increasing the share in the existing markets.

(v) Market Development Assistance (MDA) Scheme is under operation through the Department of Commerce to assist exporters for export promotion activities abroad, assist Export Promotion Councils(EPCs) to undertake export promotion activities for their product(s) and commodities and assist approved organizations/ trade bodies in undertaking exclusive non-recurring innovative activities connected with export promotion efforts for their members.

This information was given by the Commerce and Industry Minister Smt. Nirmala Sitharaman in a written reply in Rajya Sabha on 03.8.2016

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