Mini Exim sashays to a duty-free beat

NEW DELHI: If a mini budget makes a big splash, can a ‘Mini Exim Policy’ be far behind? Commerce minister Arun Jaitley did his bit today to add to the feel-good factor by presenting a set of what he called trade facilitation measures to bring cheer to consumers, as well as exporters.
A variety of items — ranging from gold and silver to imported luxury cars and the wine served by your next-door restaurant — have been made cheaper. India’s most celebrated export item, information technology, has been melded into the export process to slash transaction costs via introduction of electronic signatures and electronic fund transfer. The minister has also doled out numerous sops to exporters and the domestic industry by making imported raw materials cheaper and easily accessible. The ‘Mini-Exim Policy’, announced by Mr Jaitley here on Wednesday, also holds out promise for cheaper export credit and better insurance coverage for India Inc, to help it compete better in the international market for major projects.
Gold and silver can now be imported by anyone without them having to go through canalising agencies. This will make the precious metals cheaper as the need to pay 0.1-0.7% of the value of the import to canalising agencies has been eliminated. Apart from consumers, jewellery manufacturers will also benefit as they can now handle imports directly.
Mr Jaitley has also offered duty-free import facilities to heritage hotels, stand-alone restaurants and the lower categories of star hotels. Until now, this facility was restricted to three, four, five star hotels and restaurants located in these hotels. Depending on the foreign exchange earned by them, these establishments can import a variety of inputs, including wine, without having to pay duty. However, Mr Jaitley has cautioned that the benefits should be passed on to the customers.
“We will ask for tariff lists to prevent hoteliers from pocketing the benefit,� he told ET.
Despite the effort to explain the announcements as ‘procedural simplification’ or ‘minor decisions’ while launching the use of digital signatures for import licences, the Mini Exim Policy stood out on account import liberalisation and the attempt to cut red tape in a big way. Ranging from food products to textiles and automobiles, a number of sectors will now have easier access to imports. Refineries, fertilisers and manufacturing industries stand to gain from reduction in input costs.
Another step on the ‘feel good’ lane — brightened by a whooping 40% growth in exports during December — is simplification of import procedures for luxury cars. Automobiles priced about $40,000 can now be imported without having to go through costly homologation and difficult procedures prescribed by regulatory authorities.
Simpler quality norms have been prescribed for import of various items, including food products. Similar is the case with inputs for textile industries as even import from countries allowing use of azo dyes has been allowed, of course, subject to quality norms.
On the e-commerce front, Mr Jaitley has launched electronic fund transfer for transactions like duty drawback and payment of duty, while exporters have been encouraged to go for online licences with digital signature of the directorate general of foreign trade. The electronic data interchange system connecting 33 key ports is also being put to full use by connecting various agencies like customs, airlines, clearing agents, banks and the Container Corporation.