The Union Commerce and Industry Ministry, after consultation with the Finance Ministry, is understood to have finalised the list of sops to be announced for the labour-intensive export sectors that have been struggling for the past few months, including textiles, readymade garments, leather and handicrafts.
Along with this, sectors that have turned around and have shown good performance during this period are likely to lose the sops they are getting. This could include sectors like petroleum, engineering and chemicals.
It is expected that as Parliament is in session and the foreign trade policy is also up for review, an announcement to this effect is likely to be made by the Union Commerce and Industry Minister, Anand Sharma, in the House. The package of incentives had already been finalised and the same would be announced in Parliament along with the foreign trade policy.
The sops have been finalised after the Commerce Ministry held extensive consultations with the Finance Ministry and other bodies including Confederation of Indian Industry (CII), Federation of Indian Export Organisations (FIEO) and Federation of Indian Chamber of Commerce and Industry of India (FICCI) during the past fortnight.
With pick-up in exports since November 2009, sectors like gems and jewellery and chemicals have posted good growth but several segments like textiles and handicrafts have continued to struggle.
A major reason for lagging behind was the continued concern in the European markets. While the US market has started showing signs of improvement, the continued concerns on European debt trouble have cast a shadow on exports from the country.
On the other hand, the Commerce Ministry is learnt to have asked the FIEO to undertake a study on the extent of export diversification to non-traditional markets due to incentives provided in the Focus Market Scheme and the Market-Linked Focus Product Scheme.
The FIEO had already sought the continuation of schemes such as duty drawback, advance authorisation, duty entitlement passbook, duty free import authorisation and export promotion capital goods. It has also asked for capping export credit at the base rate so that exporters would be able to get the credit at about 8 per cent. To boost technological up-gradation, it wanted extension of zero-duty EPCG Scheme to all sectors.
