Giving a relief to exporters community, the government on Thursday said it will release Rs 56,027 crore to exporters against pending tax refunds under different incentive schemes for outbound shipments.
The amount will be disbursed to more than 45,000 exporters.
Briefing the media about the decision, Commerce and Industry Minister Piyush Goyal said that the Rs 56,027 crore, which is being released under various export promotion schemes, is over and above duty remission of Rs 12,454 crore for the Remission of Duties and Taxes on Export Products (RoDTEP) Scheme and Rs 6,946 crore for Rebate of State and Central Levies and Taxes (RoSCTL) Scheme already announced.
"So in effect, exporters will be cleared all their old dues plus another Rs 19,500 crore for the current year. Both of which aggregating about Rs 75,000 crore as liquidity will be made available to our exporters," he said adding all the amount will be cleared this year.
This amount includes claims relating to MEIS (Merchandise Export India Scheme), SEIS (Service Exports India Scheme), RoSL (Rebate of State Levies), RoSCTL, other scrip based schemes relating to earlier policies and the remission support for RoDTEP and RoSCTL for exports made in the fourth quarter of 2020-21.
The amount of Rs 56,027 crore of arrears is for different export promotion and remission schemes: MEIS (Rs 33,010 crore), SEIS (Rs 10,002 crore), RoSCTL (Rs 5,286 cr), RoSL (Rs 330 crore), RoDTEP (Rs 2,568 crore), other legacy Schemes like Target Plus etc (Rs 4,831 crore), it said.
He said that the move would help maintain cash flow of exporters and meet their growing export demand and also help the country achieve USD 400 billion target for this fiscal.
"This decision to clear all pending export incentives within this financial year will lead to even more rapid export growth in coming months," he said.
Service sector exporters, including those in the travel, tourism and hospitality segments, will be able to claim SEIS benefits for FY2019-2020, for which Rs 2,061 crore has been provisioned.
The SEIS for 2019-20 with certain revisions in service categories and rates is being notified.
This support would have a multiplier effect and spur employment generation.
The apparel sector, which is a major labour-intensive sector, will get past arrears under ROSCTL and ROSL, and all stakeholders in the interconnected supply chains would be strengthened to meet the festive season demand in international markets.
Export claims relating to earlier years will need to be filed by the exporters by December 31, 2021 beyond which they will become time barred.
The online IT portal will be enabled shortly to accept MEIS and other scrip based applications and would be integrated with a robust mechanism set up by the ministry of finance to monitor provisioning and disbursement of the export incentives under a budgetary framework.
On container shortage and high freight rate issue, he said an inter-ministerial meeting was held on Thursday and "ideas have come, and that will be examined and studied by different ministries".
Welcoming the move of clearing pending tax dues, former President Federation of Indian Export Organisations (FIEO) S K Saraf said that the delay in payments has affected cash flow of exporters in MSME sector particularly.
"This payment will be a great relief to exporters in these challenging times.
"I hope this payment is made expeditiously.
"It will save a lot of MSME from a certain extinction," Saraf said.
Sharing similar views, Ludhiana Hand Tools Association President S C Ralhan said that the move would help in promoting exports.
"Container shortage and rising freight rates will also required urgent attention of the government," Ralhan said.