New Delhi: The government on Wednesday announced incentives worth Rs625 crore for exporters of garments, engineering, electronics and agro products as the demand for these items in the western economies is yet to pick up.
The garment sector, which is still reporting contraction in overseas shipments, will receive sops for about 300 items -equivalent to 2% of the export value, commerce and industry minister Anand Sharma told reporters.
The dole-out would be given to the garment exporters under the Market Linked Focus Product (MLFP) scheme for shipments to the US and Europe- two of their biggest markets, Sharma said.
The incentives for the sector will be for six months starting 1 April.
Apparel exports declined by about 14% to $862 million in January 2010, indicating lacklustre demand for Indian garments in major markets.
Besides, 200 other products in engineering, electronics, agro chemicals and pesticides segments have been added to the MLFP scheme. They will get support of Rs225 crore from the government.
The cost of the incentive will be borne by the Commerce Ministry from its internal budget.
The Ministry has been provided about Rs4,000 crore for the new fiscal beginning 1 April.