Finance, commerce ministers spar over trade policy.

NEW DELHI: The finance and commerce ministries are sparring over the Foreign Trade Policy with North Block saying that announcements were made without consulting it on nearly half-a-dozen issues.

While the issue is being dealt with at the official level, when asked, commerce & industry minister Anand Sharma said that no announcement was made without finance minister Pranab Mukherjee's approval. On their part, his officials said the finance ministry was raking up issues that did not have merit. North Block has said that changes announced in the Export Promotion Capital Goods (EPCG) scheme, the Served from India Scheme (SFIS) and changes in the verification norms were done without the finance ministry's approval.

A turf war between the revenue department and the directorate general of foreign trade (DGFT) was the norm for years, although it had changed in recent past. But this year, the revenue department has gone back to its old ways. In most cases, commerce department officials said in case of EPCG the finance ministry merely had concerns over the language and there was no scope for misuse. The revamped policy has said that exporters can import capital goods on payment of advance duty, but the finance ministry's concern is that the mode of payment, which will be in cash, is not mentioned.

Similarly, in case of SFIS, the finance ministry had overlooked a notification that was issued in January 2011, while accusing the commerce ministry of not consulting it. "What should we do? Ignore notifications that have been issued since the policy was announced in 2009?" asked an official, while pointing out that one of the main goals of this years trade policy was to simply the procedures.

In the same vein, DGFT had done away with mandatory verification of duty credit scrips as the government had failed to put in place an electronic data interchange set-up as was promised. "This is a major step towards cost reduction. What we are saying is that it is not mandatory. We are not saying that customs department will not check the genuineness, which it is expected to do. That data is available and it can still be done," an official said.

Source : timesofindia.indiatimes.com