Budget 2016: Exporters seek incentives to boost exports from MSME
The total marketing support extended by DoC under MAI and MDA is insufficient to meet the demand of MSME for export marketing The Dollar Business Bureau
Ahead of the upcoming Union Budget 2016-17 to be announced later this month, Indian exporters have asked the government to introduce fiscal incentives for the micro, small & medium enterprises (MSME) sector, correct inverted duty structure, and exempt service tax and terminal excise duty on purchase of capital goods to encourage exports from the sector. “In view of current downfall in exports, encouragement to MSME sector by way of fiscal incentives on their year-on-year export growth would motivate them for aggressive export marketing, which in turn could help in restoring export momentum,” Federation of Indian Export Organisations said in a recommendation to the government. India’s dismal exports story has been a cause of concern for the government as well as the exporters. In January this year, India’s exports fell for the 14th month in a row, battling global slowdown and less demand from major importing economies. In past, several export bodies had come up with their parts of suggestions to the government, in an effort to encourage domestic exporters and revive the country’s stalled outbound shipments. Marketing has been the biggest challenge for the MSME exporters. “This is because most of MSMEs lack financial resources to meet the cost. The total marketing support extended by the Department of Commerce under Market Access Initiative (MAI) and Marketing Development Assistance (MDA) is insufficient to meet the demand of MSME for export marketing,” FIEO said. The exporters’ body recommended the government to come up with liberal funding for the sector, as well as create an Export Development Fund (EDF) to help exporters meet their cost and subsequently promote exports from MSMEs sector. The industry has long demanded the correction of inverted duty structure in order to strengthen India’s manufacturing sector, thereby propelling Prime Minister Narendra Modi’s pet project ‘Make in India’! FIEO also called for the Interest Equalisation Benefit (IES) to be extended to merchant exporters, in sectors such as carpet, handicrafts and agro, as they were previously eligible for benefits under interest subvention scheme.
February 20, 2016 |04:50pm IST