Boost for India's exports.

As India's economy hits the downward slope, the country's commerce minister Anand Sharma announced new measures to boost exports. He unveiled a seven-point strategy on June 5 which includes the extension of an interest subsidy scheme till March 31 next year.

The incentives will add up to over Rs1,000 crores (S$23).

Said Mr Sharma: "We have now decided to extend the scheme (interest subvention) for another year till March 31, 2013, and expand its coverage to include other labour-intensive sectors; namely toys, sports goods, processed agricultural products and ready-made garments."

He said this while releasing the annual supplement to the foreign trade policy in New Delhi.

To promote manufactured exports of green technology products, export obligation under the export promotion capital goods scheme (EPCG) is being reduced for 16 products including solar cells, wind turbines, water treatment plants and electrically-operated vehicles.

To promote manufacturing activity and generate employment in India's north-eastern states, the government has also reduced export obligation under the scheme for exporters of those areas.

EPCG is a scheme under which an exporter can import a certain amount of capital goods at either zero or

3 per cent customs duty, for upgrading technology. However, exporters have to meet a pre-determined export obligation over a certain period to avail themselves of the scheme.

Exporters and those in the industry in India have hailed the trade policy supplement as timely and said it will help make Indian goods competitive in the world market.

Federation of Indian Export Organisations president M. Rafeeque Ahmed told the Business Line newspaper that in the wake of contraction of global demand and the Euro Zone crisis, the support extended was "tremendous" and will help in imparting competitiveness to exports.

Confederation of Indian Industry president Adi Godrej welcomed most of the measures and said: "All these measures would definitely give a boost to Indian exports and would help India achieve its export target of US$500 billion (S$641 billion) by 2013-14."

Chairman of the Apparel Export Promotion Council A. Sakthivel told The Telegraph the measures would significantly boost the textile sector. "The extension of 2 per cent interest subvention to ready-made garments up to March 31, 2013, is a relief to knitwear exporters as the bank interest rate has now gone up to between 11.5 per cent and 13.5 per cent," he said.

Source :  business.asiaone.com