Govt rules out new sops for exporters

NEW DELHI: The government has ruled out a new relief package to help exporters cope with the rapid rise in the rupee’s value against the dollar.

“The government does not have any plans to give more incentives or relief to exporters,” minister of state for finance SS Palanimanickam informed the Lok Sabha in a written reply on Friday.

The commerce ministry has maintained that the government would soon announce a relief package, for which it has already submitted a proposal to the Cabinet.

In the recent past, finance minister P Chidambaram had cleared three packages for exporters aggregating Rs 5,200 crore since the $160-billion export target for 2007-08 appears difficult to achieve. He has expressed hope that export targets would be met.

Mr Palanimanickam said the government was already providing 100% tax benefits on profits from exports apart from indirect tax incentives. During the past three years, the government had incurred a revenue loss of around Rs 38,516 crore on account of direct tax sops and under reward schemes for exporters.

In addition, the duty foregone on account of tax exemptions in Customs and excise duty to export-oriented units and firms operating in SEZs were estimated at Rs 38,764 crore in the past three years, he said, adding there was no proposal to provide any new relief package.

Exporters have been demanding exemption from payment of service tax on all inputs, apart from relief on interest rate, claiming that they have been hit by the rupee’s appreciation. The Indian currency has risen by over 12% against the dollar since January this year.