The apex exporters body, Federation of Indian Export Organisations (FIEO) has welcomed the government's move to rationalise duty drawback rates to boost shipments but asked for a review of the rates related to the electronic sector.
The government on Saturday rationalised the rates of duty drawback and expanded the list of items under the tax refund scheme for exporters. In a statement, the Finance Ministry said that the revised all industry rates of duty drawback which have been notified will come into effect from September 21, reports media.
President, FIEO, M Rafeeque Ahmed welcomed the Drawback Rates, but ask for review for Electronic Sectors Responding to Duty Drawback rates.
He expressed concern over the sharp decline in drawback rates for electronic sectors. "By and large Drawback rates are on expected lines as generally the decline are in the range of 0.1 percent to 0.5 percent with few exceptions," Ahmed said in a press statement.
Ahmed welcomed increase in rates for silk garments, fabrics and yarn, gold and silver jewellery and also bringing milk products under Drawback as exports growth in dairy sector has been encouraging.
President FIEO, however, expressed his concern on sharp decline in drawback rates for electronic sectors where the DBK rates for Coloured and Black & White TVs have been slashed from 4 percent to 1 percent and Public Address Systems etc from 2 percent to 1 percent.
"Since only recently we introduced new electronic hardware policy with a view to encourage hardware manufacturing in India to reduce electronics imports, which may cross over USD 200 Billion in next 5-7 years," said Ahmed, the rate for the sector may be reviewed looking at broad objectives.
FIEO has also provided a comparison of Drawback rates for important exports sectors. Drawback comparison document is attached below:
The government had taken into account the recommendations of the committee headed by Planning Commission Member Saumitra Chaudhuri. He is also Member of the Prime Minister's Economic Advisory Council, reports media.