By IANS,
New Delhi : The government Thursday announced various incentives, including interest subsidy, worth around Rs.1,700 crore to boost the growth of exports in view of the slowing demand in US and European markets.
“It is difficult to put the number, but my guess is the total financial outgo will be around Rs.1,700 crore,” Commerce Secretary Rahul Khullar said at a press conference here.
He said nearly half the financial outgo would be in the form of interest subvention or subsidy on interest. “Interest rate subvention itself will cost around Rs.800-1,000 crore. Other schemes will cost roughly around Rs.800-900 crore,” he said.
Commerce and Industry Minister Anand Sharma Thursday announced the annual review to the Foreign Trade Policy 2009-14.
The minister announced several schemes to keep the growth momentum in the foreign trade.
“We have been able to secure interest subvention of two percent on rupee export credit which have been extended up to the end of the current financial year,” he said.
The subsidy will be available to exporters with retrospective effect from April 1, 2011 until March 31, 2012. The earlier interest subsidy scheme had lapsed at the end of last fiscal.
To promote market diversification, the minister said the government would provide four percent duty credit to exporters under a new Special Focus Market Scheme.
“We are introducing today a special focus market scheme. It will cover 41 countries – 12 from Latin America, 22 from Africa and seven from CIS countries,” Sharma said.
The government has also introduced a new scheme to provide special assistance to engineering, pharmaceutical and chemical sectors for the period of 6 months.
The new Special Bonus Benefit Scheme will cover 50 products, including hand tools, gas compressors, motorcycles and goods vehicles, carbon black, potassium iodide, niacin amide, erythromycin and its derivatives and ciprofloxacine.
Under the scheme duty credit of one percent will be given. The scheme is applicable from Oct 1, 2011 to March 31, 2012.
In view of the slowdown of demand in US and European countries, the government has extended the market linked focus product scheme to these countries as well.
India’s exports have risen by 52.1 percent to $160 billion in the first six months of the current fiscal.
The growth in exports has declined in the recent two months mainly because of the slowdown in demands of Indian goods in US and European countries due to economic uncertainties.