A. Sakthivel, President, Tirupur Exporters Association (TEA) has welcomed providing additional Duty Credit Scrip at 1% of the FOB value of exports being made in 2009-10 and 2010-2011 to Status Holders. He said the introduction of Zero Duty EPCG Scheme and reduction of export obligation equivalent to 6 times of duty saved on capital goods imported under Zero Duty EPCG Scheme are laudable measures. He also appreciated the announcement of the reduction of export obligation to 50% of the normal specific export obligation on import of spares apart from increase in incentives available under focus Market Scheme from 2.5% to 3% and the focus Product Scheme from 1.25% t o 2%. He is equally happy with the announcement ensuring the Dollar credit needs of exporters in a timely manner which will be of great help to the exporting community. He, however, found the announcement of extension of MLFPS scheme beyond 20 September 2009 missing and urged the Minister to extend the scheme for 3 more years, as the markets for apparel products in the US and the EU have not yet picked up.

G.S. Madan, President, Garment Exporters Association (GEA) termed the Foreign Trade Policy, "A good policy theoretically but lacking a certain practicability as far as the apparel export trade from the country is concerned." He said, "The policy earlier had granted 2% market linked duty credit scrip, which is now slated to be withdrawn from 30 September 2009. This definitely is not the right time to withdraw the support because as it, we are being out-priced by other countries in supply of garments and in the absence of any support, we would tend to lose out on customers we may have painstakingly established over many decades. In view of this, the duty credit scrip for the US and the EU must be continued for another year and then reviewed."

Madan noted that the addition of new countries in the Market Linked Development Scheme is a welcome measure as a long-term policy, but for the apparel trade to establish itself in these countries would take quite sometime, considering their demographics, purchasing power and our apparel export product profile, which at present is not in tandem with their present requirements.

Satish Bagrodia, President, PHD Chamber, while welcoming the features like increase in support under the Focus Market Scheme and Focus Product Scheme and inclusion of newer markets and products, expressed his disappointment that no major steps have been taken to address the slowdown in exports and provide a fillip to exports. He felt it was necessary to address issues such as timely export credit at internationally competitive rates, providing inputs at international prices; safeguard to exporters against dollar fluctuations etc. should have been taken care of. He added, "Continuity of other schemes i.e. DEPB scheme, income tax benefits for IT and 100% EOUs, interest subvention are also welcome steps. Bagrodia welcomed the decision to set up a Directorate of Trade Remedy Mea sures to provide support to Indian industry and exports, especially the MSMEs in availing of their rights through trade remedy instruments and he was looking forward to an early announcement of the terms of reference of this proposed Directorate.

Sajjan Jindal, President, Assocham has described foreign Trade Policy as user-friendly since it rightly focuses on creation of demand for Indian products in new 26 markets to help exporters diversify their risks. He said, Commerce Minister has realistically set up export target of $200 billion for 2010-11. He appreciated the enhancement in export incentives especially raising them from 2.5% to 3% under focus Market Scheme as also from 1.25% to 2% under focus Product Scheme. These are extremely significant steps for which Commerce and Industry Minister needs to be complimented. He said another bold step taken by the Government includes extension of re-fixation of Annual Average Export Obligation for a period of another 5 years. Likewise, extension of the DEPB and interest subvention of 2% pre-shipment credit for 7 specified sectors have also been extended, which is most welcome.

What do we Say?

In our July, 2009 issue of The Stitch Times, I had already given an inkling as to what is forthcoming and even more importantly why? Though I had quoted Anand Sharma, Commerce Minister as saying We are already looking at a special package for exporters, the manufacturing sector and labour-intensive sectors. By giving incentives, we will make Indian exporters globally more competitive. We will be taking up these issues with the Finance Ministry (Page 26), I had written, Let me state that I personally do not believe that anything substantial in terms of fiscal measures would be forthcoming for garment export sector. I have a reason a sound one. The financial health of the Government revenues is far from satisfactory.. (Page 27). On the same page, I had made a statement that At the end of 2007-08, the government accounts surprised on the upside. The target for red using Centres fiscal deficit to 3% had been exceeded, but during 2008-09, its expenditure shot up because of farm loan waiver, implementation of Sixth Pay Commission and increased allocation to several under-funded social sector programmes. I had then added, The Controller General of Accounts (CGA) data shows a 42% decline in Customs revenue in the fourth quarter. Likewise, Excise duty collection too experienced a sharp decline, falling 34%.