NEW DELHI (TIP): In a bid to boost exports and bring down the current account deficit (CAD), the government on April 17 announced the Foreign Trade Policy (FTP) which included major measures to revive the special economic zones (SEZ) and allowing exporters in all sectors to import capital goods at zero per cent duty under the Export Promotion Capital Goods (EPCG) scheme.
This was announced by Commerce and Industry Minister Anand Sharma as part of the annual supplement to the Foreign Trade Policy (FTP) for 2013-14. Exports declined by 1.76 per cent to $ 300.6 billion during 2012-13 and pushed up the trade deficit to $ 190.91 billion. Acknowledging difficult global economic environment, the minister said in its latest report the World Trade Organisation (WTO) has revised the global trade growth projections downwards from 3.7 per cent to 2.5 per cent. “This is indeed a disturbing trend.
We view exports not only as a valuable source of foreign exchange, which help in stabilising the Current Account Deficit, but also a key contributor to growth and employment”, he said. The FTP had announced significant measures for boosting SEZ scheme. The minimum land area requirement for setting up such zones has been reduced to half and there would be no ceiling for IT and ITes SEZs. On demands of exit policy for SEZs, the minister said it has been decided to allow transfer of ownership and sale of SEZ units. However, industry demands pertaining to removing minimum alternate tax (MAT) and dividend distribution tax (DDT) have not been accepted.
The EPCG scheme, which allows exporters to import capital goods at zero duty, would be extended beyond March 2013 and would be applicable to all sectors. “We have decided not only to extend the zero duty EPCG scheme beyond March 2013, but also merge it with 3 per cent EPCG scheme. Now, the zero duty EPCG benefit will be available to all sectors,” the minister said.