FIEO Points For The Board Of Trade Raised By S.C Ralhan, President, FIEO

• Investment linked benefit for MSME Exporters: The investment to build new capacities in exports and manufacturing is not forthcoming. This is hurting employment creation and also hitting the Make in India initiative of the Govt. There is need to provide some fiscal support for modernization and expansion of the production base. It would be worthwhile if investment linked tax benefits be allowed particularly to the MSME units, where capital employment ratio is very high, with a cap of Rs.25 crore.

• Line of Credit or Buyers Credit to boost exports: Commodity and Oil dominated economies in Latin America , Africa ,Middle East are witnessing scarcity in foreign exchange reserves and thus reducing their imports. In some countries, Government has put restrict on current account transfers and few are allocating limited foreign exchange for essential imports. Such countries in this slow down scenario could be considered as an opportunity for India if the Government can lends its hands by providing Line of Credit or Buyers Credit which will help in boosting exports.

• Advance Ruling Facility: There should be a facility of an Advance Ruling in DGFT as provided by customs, excise and income tax so that an exporter/foreign supplier who wish to be clear on any provision of the Foreign Trade Policy before venturing into exports activity under a particular Scheme can obtain a statutory ruling in the form of Advance Ruling. This will give push to technology transfer as well since Indian importers of technology can obtain ruling which will be binding on DGFT . This will be a step in Ease of Doing Business.

• Export Development Fund and changes in MAI Scheme :Countries are supporting aggressive marketing to get limited orders available globally. Government should create an Export Development Fund for aggressive marketing particularly for MSME. Such fund should subsume Market Access Initiative and Market Development Assistance Scheme. Moreover, the restriction of only allowing 3 participation to an Export Promotion Council may be withdrawn under the MAI Scheme as it will affect the small exporters badly . Moreover, Councils are subject to a penal cut if the number of participants are less than the projected initially . The projections are made a year in advance and global situation may change in the meantime. The penal provision should be replaced with proportionate cut so that MAI support may be proportionately reduced.

• Iran as a Focus Market: India has generated goodwill during the sanction period which needs to be encashed after the lifting of sanctions. Many of the exporters have received payment in US Dollar for exports to Iran which could not materialized as RBI has yet to issue instruction for settlement of trade transactions subsequent to restoration of SWIFT. RBI has suggested to route them through the Rupee payment mechanism. The delay is costing Indian exporters and in few cases the payment in foreign exchange has to be remitted back in view of absence of guideline by RBI.