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Tourist units earning forex of Rs 60m recognised as export houses

Meeting a long standing demand of the sector, tourism minister Madan Lal Khurana today announced that all tourist units earning Rs 60 million as foreign exchange will be recognised as export houses.

''The commerce ministry will issue the notification within a week in this regard,'' Khurana said at a press conference.

The decision to give export house status to tourism was taken at a meeting that Khurana had with Commerce Minister Ramakrishna Hegde and Finance Minister Yashwant Sinha on Saturday.

Khurana said the tourism sector would now get all the benefits and incentives which are given to export houses. He expected that tourism, which brings in Rs 120 billion per year, will get a big boost.

''After evaluation of all aspects of the demand, it was felt that there is a need to give such a recognition to the tourism units to give a boost to foreign exchange earnings, employment and income generation through tourism,'' Khurana said.

Consequently it was decided that in the case of tourism units, the threshold limit will be half the existing limit for other exporters, purely as an initial incentive for two years, the minister said.

Khurana said it was decided at the meeting that the zero duty threshold limit in the case of imports required by the tourism sector will be reduced from Rs 200 million to Rs 10 million in the case of imports made by the tourism units identified as export houses.

Other benefits that tourist units bringing in Rs 60 million in foreign exchange can avail are Special Import Licences free trading of these SILs, import of several equipment under these SILs, waiver of bank guarantee for import, and import of cars against foreign exchange earnings.

Khurana said it was also decided that balance amounts of profits accruing should be allowed to be invested in equity shares of various tourism segments including hotels.

The proposal regarding reduction in excise duty on tourist cars and coaches will be appropriately considered. In the case of reduction of import duties, the tourism ministry will take up with the finance ministry, proposals for reduction in import duties of identified items needed by the tourism ministry.

The tourism, commerce and finance ministers at their meeting also recommended that suitable marketing development assistance for initiatives by the private sector and state governments for promotion of tourism abroad should be devised by the tourism ministry.

UNI

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