The Government’s attempt at rationalising export promotion schemes to increase focus on labour-oriented and high growth areas is being resisted by various export bodies who do not want to give up their present benefits.

“The promotion schemes, both product and market linked, are way too many and there is a need to bring them down. But, it is turning out to be very difficult to go about it,” a Commerce Ministry official told Business Line.

Commerce Minister Nirmala Sitharaman, who will announce her first Foreign Trade Policy soon, will now have to take a call on whether to walk along the beaten path and continue giving small sops to all or restrict incentives to just a handful of sectors that have high growth potential or generate more jobs.

“This will be a political decision and it is the Minister who can take it in consultation with the Finance Ministry,” the official said.

Three schemes run by the Commerce Ministry—the focus product scheme, the focus market scheme and the market-linked focus product scheme—cover so many items and markets that there is nothing special about them any more. More than 750 products and 150 destinations are included in the schemes. The benefits range between 2 per cent and 5 per cent of the value of exported goods.

The Commerce Ministry wants that higher benefits should be given to lesser number of products and markets based on the growth potential they hold and the jobs they generate. “High growth sectors like textiles, pharmaceuticals, electronics and engineering goods will bring more benefits for the country if the right dose of incentives is given,” the official said.

Similarly, large markets that India has not yet explored well such as Russia, Brazil and China, which have so far not been covered properly in the incentive schemes, need to be promoted.

“These markets are bigger and so it is obvious that the Government would have to spend more in the form of incentives. Since resources remain a constraint, a carefully considered decision needs to be taken,” the official added. The Economic Survey for 2013-14 also stressed on the need to bring down the growing number of export promotion schemes.

In the discussions on the Foreign Trade Policy being carried out by the Commerce Ministry with various export groups and export promotion councils, all sectors have made a case for more sops to promote shipments. “The Directorate General of Foreign Trade is finding it very difficult to convince any sector to give up a particular benefit even if there is opportunity for it to get benefits under a different scheme,” the official added.

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