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Shri Kamal Nath, Union Minister of Commerce & Industry, has said that agriculture will be one of the major focus areas of the Foreign Trade Policy (FTP) 2004-09 which is presently under implementation.
Some of the benefits announced in the new FTP under the special package on Agriculture listed out by the Minister in the Rajya Sabha today are:
A new scheme called the Vishesh Krishi Upaj Yojana (Special Agricultural Produce Scheme) for promoting the export of fruits, vegetables, flowers, minor forest produce and their value added products has been introduced;
Funds to be earmarked under the Assistance to States for Infrastructural Development for Exports (ASIDE) for development of Agri Export Zones (AEZs);
Import of capital goods to be permitted duty-free under the EPCG scheme;
Units in AEZ to be exempt from Bank Guarantee under the EPCG scheme;
Capital goods imported under EPCG to be permitted to be installed anywhere in the AEZs;
Import of restricted items, such as panels, to be allowed under the various Export Promotion Schemes;
Import of inputs such as pesticides to be permitted under the Advance Licence for agro exports; and
New towns of export excellence with a threshold limit of Rs. 250 crore to be notified.
With a view to doubling India’s percentage share of global trade within 5 years and expanding employment opportunities, especially in semi-urban and rural areas, certain special focus initiates have been identified for the agriculture, handlooms, handicrafts, gems & jewellery and leather sectors.
Some of the new incentives announced for Export Oriented Units (EOUs) in the FTP 2004-09 are:
EOUs shall be exempted from service tax in proportion to their exported goods and services;
EOUs shall be permitted to retain 100% of export earnings in Exchange Earners’ Foreign Currency (EEFC) accounts;
Income Tax benefits on plant and machinery shall be extended to Domestic Tariff Area (DTA) units which convert to EOUs;
Import of capital goods shall be on self-certification basis for EOUs;
For EOUs engaged in textile & garments manufacture leftover material and fabrics up to 2% of CIF value or quantity of import shall be allowed to be disposed of on payment of duty on transaction value only; and
Minimum investment criteria shall not apply to Brass Hardware and Hand-made Jewellery EOUs (this facility already exists for handicrafts, agriculture, floriculture, aquaculture, animal husbandry, IT and services sectors).
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