Tv Makers Seek Incentives To Boost Exports
The television manufacturing industry has urged the government to immediately announce a policy giving incentives for non-kit television exports to check a slump in exports, which has occurred due to non-alliance to export in non-kit form as per duty entitlement passbook (DEPB) requirements.
According to government officials, the commerce ministry has received a representation from the Consumer Electronics & Television Manufacturers Association (Cetma) saying that lack of a policy for non-kit exports has resulted in a loss of opportunity worth $15-17 million in 1997-98.
The industry has urged the government to allow export of more items of completely built units (CBU), completely knocked down kits (CKD), and semi knocked down kits (SKD) out of the Bill of Material.
Besides, the duty entitlement passbook (DEPB) rates on exports of parts (non-kit) should be the same as applied to CBU/SKD/CKD exports, says the industry.
Industry observers say television exports have slumped in recent times, especially in the black & white television segment, as various countries have stopped importing completely built units, semi knocked down units and completely knocked down units.
Instead, various countries are now focusing only on non-kit imports to encourage local value-addition.
The developing countries, especially, are following a competitive procurement policy sourcing anything from anywhere.
India has. meanwhile. stuck to the old norms and not devised any policy to promote non-kit exports, although the requirements of the world market have changed.
Indian exports have been facing stiff competition from other countries like Turkey that enjoy preferential duty from European countries.
As a result, the black & white television exports stood at 250,000 in the CBU/SKD/CKD form.
The opportunity is seen at 1 million, had the non-kit category been facilitated.
There is fear in the industry that other countries will soon appropriate India's share in world television exports unless the government comes out with a market-compatible exports policy.
Exports are also seen to have suffered as a result of the reduction in modvat claim to 95 per cent of the eligible amount.
The ultimate impact of the reduction is said to be 7 per cent, and more if the cost of locked-in funds with the government is taken into account.
The mood in the television is industry is apprehensive, even though the production of colour televisions has grown 40 per cent during April-June 1998 in comparison to the corresponding period of 1997.
Industry observers say this growth is not natural, as it has been fuelled by the soccer world cup in France and the promotion schemes of Akai.
The domestic industry continues to suffer constraints due to the reluctance of banks and financial institutions to finance it, an excise duty structure which is considered anomalous and an absence of uniform guidelines on sales tax at the state level.