Govt forms panel to review deemed exports policy

The government today said it has formed an expert committee to review deemed exports policy where there have been incidents of misuse of the scheme.

Deemed exports refer to those transactions in which goods supplied to the users do not leave the country and payment for such supplies is received either in Indian currency or in foreign exchange.

Last week, the government constituted a panel to improve drafting of the policy aimed at avoiding multiple interpretations, according to a Commerce Ministry statement issued here today.

Besides, the group would examine whether the scheme properly reflects the government priorities.

The committee has invited comments from stakeholders in this regard.

It would also meet RBI Governor D Subbarao and Planning Commission Member BK Chaturvedi for discussions and is expected to submit its report to the Commerce Ministry by August.

The panel, which is chaired by Director General of Foreign Trade (DGFT) Anup K Pujari, comprises members from Planning Commission, RBI and Department of Economic Affairs.

The committee was formed on the directions of Commerce and Industry Minister Anand Sharma to review the existing scheme.

There have been reports that the policy is being misused, especially in the power sector. The DGFT decided to send recovery notices to those under its scanner, sources had said.

Recently, the ministry has also tightened the norms governing the scheme, a move expected to save about Rs 1,800 crore to the exchequer annually.