New Delhi: The commerce ministry on Thursday allocated an additional Rs.1,500 crore in support of 2,091 new items under the Merchandise Exports from India Scheme (MEIS) in the backdrop of that it called the “continued challenging global environment being faced by Indian exporters”.
India’s merchandise exports contracted by 0.3% to $21.5 billion in August for the second consecutive month after expanding for the first time in 19 months in June.
While unveiling the long-delayed foreign trade policy (FTP) 2015-20 in April last year, commerce minister Nirmala Sitharaman had said the policy will no longer be revisited annually and will only be reviewed after two-and-a-half years to provide a stable policy framework.
The new policy merged all subsidy schemes for merchandise exports and service exports into two separate schemes to simplify the export subsidy regime, and for the first time included units within export-oriented special economic zones (SEZs) under the ambit of such incentives.
With the fresh announcement—a mini FTP—the total number of items covered under the scheme has increased from 5,012 to 7,103. The total support extended by government under the scheme has been enhanced from the present Rs.22,000 crore to Rs.23,500 crore per annum.
In addition to the new items added, the rates of 575 product items falling under 11 products categories have been increased. These product include: products of iron and steel, handicrafts, moulded and extruded goods, rubber, ceramic, glass, auto tyres and tubes, industrial machinery engineering items, internal combustion engine, machine tools/parts, items of wood, paper, stationary, footwear, auto seats, steel furniture, prefabs, items under the category of butter, ghee and cheese, dried egg albumin and rubber products.
The additional 2,091 products included industrial products under different categories, including engineering goods, fabrics, garments, chemicals, ceramics, glass products, leather goods, newspapers, periodicals, silk items, made ups, wool products, tubes, pipes etc. Many items of traditional medicines like Ashwagandha herbs and its extracts, other herbs, and extracts of different items have been added. Certain marine products, sea feed items, onion dried, processed cereal products and other value added items of plastics, lather articles, suitcases etc will also benefit under the MEIS.
S.C. Ralhan, president, Federation of Indian Export Organisations said that the expansion of MEIS will provide wider coverage and now about 70% of total tariff lines as against 46% earlier would be covered under the scheme. “The government has tried to cover as many products as possible under the scheme. The higher MEIS on 575 products will give them added competitiveness to face the increasing global challenges,” he added.