By TIOL News Service

NEW DELHI, SEPT 15, 2019: AFTER two stimulus packages, the turn of exports and real estate sectors finally came when the Union Finance Minister, Mr Nirmala Sitharaman, announced a mega WTO-compliant export incentive scheme which will cost the Exchequer about Rs 50,000 Crore. The package for the real estate projects which fall under the head - non-NPA and non-NCLT, is worth Rs 20,000 Crore. About 3.5 lakh dwelling units are likely to get benefited.

Addressing the press persons, the FM unfolded the new export promotion scheme - Remission of Duties or Taxes on Export Product (RoDTEP). This will replace MEIS. The existing dispensation in textiles of MEIS + old ROSL will continue up to 31.12.2019. Textiles and all other sectors which currently enjoy incentives upto 2% over MEIS will transit into RODTEP from 1.1.2020. In effect, RODTEP will more than adequately incentivize exporters than existing schemes put together.

The Union Minister also unveiled the Interest Equalization Scheme (IES) on pre and post shipment rupee export credit introduced from 1.4.2015 providing interest equalisation at 3% to exporters on 416 lines and for all MSME exporters. The IES rate increased to 5% for MSME exporters with effect from 2.11.2018 and merchant exporters were covered under the scheme with effect from 2.1.2019.

Government has also decided to expand the scope of ECIS by Export Credit Guarantee Corporation (ECGC). It will offer higher insurance cover to banks lending working capital for exports. Premium incidence for MSMEs will be moderated suitably. It is expected that the initiative will cost about Rs 1700 cr per annum.

This will enable reduction in overall cost of export credit including interest rates, especially to MSMEs. Priority Sector Lending (PSL) norms for Export credit have been examined and enabling guidelines are under consideration of RBI. This will release an additional Rs. 36,000 crs. to Rs 68,000 crores as export credit under priority sector. Export Finance will be actively monitored by an Inter Ministerial Working Group in Department of Commerce, tracked through a dashboard, reviewed with institutions and active intervention carried out.

Ms Sitharaman said that technology will be further leveraged by timely completion of ongoing initiatives to further reduce "Time to export" - though seamless process digitization of all export clearances (port/airport/customs, etc) and elimination of offline/manual services. An action plan to reduce Time to export/turn-around time in airports and ports benchmarked to international standards will be implemented by Dec 2019. Actual turnaround times will be published in real time for each port and airport to push them to improve performance. An Inter-Ministerial Group will be made accountable for this.

The Govt has also decided to organise Annual mega shopping festivals in India in 4 places across 2020 March in 4 themes (G&J, Handicrafts/Yoga/Tourism, Textiles and Leather).