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GST will dent exporter liquidity, hike compliance cost substantially: FIEO

Due to GST, the FIEO stated that about Rs 1,85,000 crore will get stuck with the government

Press Trust of India  |  New Delhi 

Cube, GST

The Goods and Services (GST) will severely dent the liquidity situation of traders and the compliance cost of merchant exporters may go up, top exporter body FIEO said today. According to the Federation of Indian Export Organisations (FIEO), export competitiveness of domestic players may fall by about 2 per cent due to liquidity problems. FIEO Director General Sahai said the is looking into various options to neutralise the effect of regime. "will severely dent the liquidity of the exporter in a big way and the compliance cost of the merchant exporter may go up. Export competitiveness of may tank by about 2 per cent and this will be a big blow to exporters," he said in a statement. FIEO President Ganesh Kumar Gupta termed as a "path breaking" reform, but it will bear fruits in the long run with initial hiccups. He explained that the liquidity problem of the exporters, delays in initial returns for in July and August, procedural issues in bonds are being flagged by FIEO with the officials concerned.

The issues were discussed in Mumbai yesterday. Before GST, exporters used to get ab-initio exemptions from duties. But they have to pay first and then seek refund. Due to this process, the FIEO stated that about Rs 1,85,000 crore will get stuck with the

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First Published: Fri, July 14 2017. 15:54 IST