Exporters fighting to meet their individual targets may face further problems in the event of the present DEPB scheme expiring on September 30, 2005.
Duty Entitlement Passbook Scheme (DEPB) was introduced to encourage and promote export under WTO. In effect, it was meant to reduce the customs duty burden on the import content of the export product.
Now, when the scheme is to close on September 30, its alternative to net taxes paid by exporters has run into technical glitches.
Sources revealed DEPB scheme was inconsistent with WTO stipulations which do not allow use of domestic inputs under the deemed import status to enable exporters draw credit for importing those items not covered under the negative list and do not assist in export production.
One important characteristics of DEPB credits is that they are freely transferable and can be utilised for paying off customs duty on any item that is easily importable except for capital goods.
However, the WTO rules do not go alongwith this fact under DEPB scheme that import of the very inputs can be used in the exported product.
Hence, a suitable scheme that ensures exporters get exemptions from paying all local levies such as electricity or fuel tariffs, be proposed.
DEPB credit reached Rs 11,000 crore each year, and have dropped down to the Rs 6,000-7,000 crore range, will only make the Government happy.
More pertinent is the fact, that as the country has embarked on an ambitious export target of $92 billion for the current fiscal, the Government on its part should bring in suitable scheme to enable exporters efficiently operate in an already challenging business environment.
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
