Commerce and Industry Minister Kamal Nath has announced the annual supplement to the Foreign Trade Policy. According to the policy, the export target for FY08 stands at $160 billion. Nath feels that this policy will help the handloom and handicraft sector.
Excerpts from CNBC - TV18's exclusive interview with the minister:
This is not just an Exim Policy, but a trade policy as well and the thrust is not just on dollar accretion but on job creation too. So is it right to say that the policy actually focuses on the farm sector, agricultural sector and on creation of jobs?
This policy will reach out to the millions of people in the handloom and handicraft sector. India is a great depository of traditional scales, which not only have to be preserved but also have a global market. So I have provided some incentives for them.
Can we say that there will be no service tax on exports out of India?
You are saying that you are going to replace duty entitlement pass book scheme from next year but many of the exporters say that they want to retain this scheme. So given that fact, why do you want to replace it at all and is there unanimity on the formula to be applied for duty remission as well as on who is going to bear the cost --
We are looking at the new scheme and will finalise it soon; we have been working on this for the last one year. The Duty Entitlement Pass Book, or DEPB scheme is outdated and has really lived its life. We need to have a much more solid scheme there, which we are going to replace.
One of the aims of the trade policy is to actually compensate exporters for poor infrastructure and the job is being done by the special economic zone policy, which is trying to create a world-class infrastructure. Does it make sense to put a cap on special economic zones of 5,000 hectres if the aim is to improve infrastructure? Doesn't it make sense to improve infrastructure on a wider area rather than restrict it?
In India when there is so much pressure on land and as the density of population is much more, getting large areas is very difficult. So at the moment, we have fixed it at 5,000 hectares and as and when rehabilitation or new land acquisition policies are enforced, we would be willing to look at this, but now we don't want to put a stop to it. So we will address it milestone-by-milestone.
Service tax on exports abolished, sops for SEZs