The Hindu : Business : SIMA welcomes foreign trade policy

Online edition of India's National Newspaper
Tuesday, Apr 12, 2005

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Business

SIMA welcomes foreign trade policy

By Our Staff Reporter

COIMBATORE, APRIL 11. The Southern India Mills' Association (SIMA) has welcomed the new foreign trade policy saying that it would benefit the textile industry. In a statement, the SIMA Chairman, Vijay Venkataswamy, hailed the decision to continue the Duty Entitlement Pass Book (DEPB) scheme in its existing form till a new scheme is put in place.

Welcoming the initiatives under the annual supplement to the Foreign Trade Policy (FTP), he said the Government's assurance that the problems faced by exporters over the taxation of profits on sale of DEPB scrips would be looked into would provide a big relief for them. The measures would give a facelift to the traditional and sunrise sectors and the Government's decision to develop a trademark for handlooms would help the sector cater to the niche market with a distinct identity, he said.

The policy had eased the Export Promotion Capital Goods (EPCG) scheme and provided incentives to fast track companies.

Stating that companies making 75 per cent or more of the exports under the scheme in half or less than half of the original export obligation period would be freed from the balance export obligation, he noted that the announcement would help the textile industry.

"Many units opting for the EPCG scheme were fulfilling their export obligation much earlier than the originally envisaged period," he said.

Mr. Venkataswamy, however, said that the non-removal of the maintenance of average level of exports clause was a cause for concern as many Domestic Tariff Area (DTA) units who exported more than 75 per cent of their production found it difficult to maintain the average level of exports due to fast-changing market dynamics.

The setting up of an inter-State trade council was a timely step that gave fresh hope to exporters as various local levies could be reimbursed, he observed. Procedural simplifications such as a single application form (Aayaat Niryaat) and the pledge to complete connectivity between customs and the Director-General of Foreign Trade (DGFT) would help boost exports in the long run, Mr. Venkataswamy said.

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