Ficci Seeks Revision Of Passbook Scheme

The Federation of Indian Chambers of Commerce & Industry (Ficci) has urged the government to revamp and broadbase the duty entitlement passbook (DEPB) scheme for exports to allow use of domestic inputs and to extend duty credit for procurement of domestically produced excisable goods.

In a note submitted to the commerce ministry as a sequel to recent measures announced by the commerce minister, the industry chamber has said the DEPB scheme should be extended to deemed exports to provide a notional credit entitlement of about 10 per cent in case of all residual products for which input/output norms have not been fixed.

In another suggestion, Ficci has said that the export promotion capital goods (EPCG) scheme should be available with a lower threshold of Rs 1 crore. It should hold good for all focus areas and not remain confined to select sectors.

Further, EPCG licence holders should be encouraged to source their requirements from within the country wherever possible by appropriately modifying export obligations in such cases. Deemed exports should be freed from the incidence of sales tax, octroi and other levies of state governments and local authorities.

In order to overcome the procedural difficulties and reduce the transaction cost, Ficci has mooted a time limit for various clearances in terms of days and hours. It is reported that in countries like Singapore, only eight hours are taken to provide export clearances at the ports and airports, the chamber has pointed out. Export documentation, too, should be simplified like Saral of income tax.

A one-point clearance facility should be introduced to avoid exporters running between various offices like the directorate general of foreign trade, ECGC, export inspection councils, customs authorities, the Reserve Bank of India, FIs and the like. Ficci has also suggested that customs-related complexities such as exports and imports should be governed from different yardsticks. Exports require more of facilitation than control, while imports may require a little more cautious approach.

Customs regulations should therefore be segregated for exports and imports.

Another suggestion made by Ficci is that customs authorities all over the country should be given export targets. Their performance should be judged on the basis of export consignments cleared and value and volume of exports generated. The customs duty payable should be made on the pattern of income tax.