Duty Entitlement Rates For 574 Items Notified

The commerce ministry yesterday announced the duty entitlement rates for 574 items under the duty entitlement pass book (DEPB) scheme. This takes the total number of items for which duty entitlement rates have been announced to 625. Rates for 51 items were announced on April 8.

The two month gap between the announcement of the scheme and of the rates for a bulk of the items is said to have caused immense damage to exporters.

It is not clear how many rates have still to be announced. None of the officials of the directorate general of foreign trade was available for comment.

Director general of foreign trade S B Mahapatra had earlier told Business Standard that the rates were for the post-export scheme and therefore the exporters first had to export and subsequently avail of the credit. Hence, they were not directly affected by the delay, he said.

The DGFT notification has also announced a new clause in the post-export DEPB scheme. Under this, in respect of products for which the rate of credit entitlement under the DEPB scheme comes to 15 per cent or more, the amount of credit against each such export product will not exceed 50 per cent of the present market value of the export product. Further, at the time of export the exporter will declare on the shipping bill that the benefit under the scheme against the export product will not exceed 50 per cent of the present market value of the export product. It is not clear why this new stipulation has been introduced.

The notification has also fully operationalised the scheme by allowing exporters who are still in anticipation of the entitlement rate by using the standard input output norms.

Of the 574 items whose rates have been announced, 347 are in the bulk chemicals product group, 91 are engineering good, 71 are plastics and 65 electronics items.

The earlier notification issued on April 8 covers 51 products under the leather, plastics and ready-made garments other than silk product groups. The rates for these groups range between 4-20 per cent. Most leather items have been allowed a rate of credit of 4-10 per cent. All kinds of writing instruments under the plastics product group have been allowed a credit of 20 per cent and most ready-made garments have been allowed a credit rate of 20 per cent. Only certain cotton items have been allowed a credit rate of 15 per cent.

The rates for chemicals vary from 4 per cent to 20 per cent, the bulk at 8 per cent. Engineering items rates vary from 8 per cent to 20 per cent, the bulk at 15 per cent. The rates for plastics vary between 3 per cent and 18 per cent, the bulk at 17 per cent. For electronics the range is 15 per cent to 24 per cent, the bulk at 15 per cent.