Additional export sops for diesel engines

The centre’s notification to add diesel engines — used for irrigation — in the focus product category with effect from April 1, 2008 is likely to benefit over 3,500 units of Punjab. The majority of these are in the MSME (micro, small and medium enterprises) sector. The notification to this effect was circulated on October 10, 2008. The move is expected to boost exports from Punjab and other states and create employment opportunities for the local youth.

With the notification in place, diesel engine exporters will get additional export benefits to make their products more successful and competitive in international markets. The focus product scheme allows benefits under Duty Entitlement Pass Book Scheme (DEPB) at the rate of 5.25 per cent of the total value of exports as compared to 4 per cent earlier.

The focus product scheme aims to provide a thrust to manufacture and export of industrial products which could generate large employment per unit of investment compared to other products

Diesel Engine sets are exported to West Asia, Africa and other developing countries. The total export from this sector is over Rs 500 crore from India. Punjab, Uttar Pradesh, Gujrat, Maharashtra, Madhya Pradesh are the major centres for manufacturing. Punjab contributes more than Rs 150 crore through established export houses. The major manufacturing centres in Punjab are Phagwara, Ludhiana, Bathinda and Amritsar.

Currently, there are 12 export houses in Punjab and over 3,500 units which manufacturer and supply components to these export houses. Around 5,000 workers are engaged in the industry. Speaking to Business Standard, an industrialist said: “The sale of diesel engine sets for irrigation has dwindled in the recent past due to decreasing water table in Punjab. Also, more people are opting for submersible pumps. The notification of the centre will give filip to the existing industries.”