Focus Market Scheme to include African countries

The commerce ministry has notified the 57 countries of Latin America and Africa which would be covered under its Focus Market Scheme. This export promotion scheme was announced under the annual supplement to the foreign trade policy on April 7.

Notification of the countries under the scheme was delayed as the commerce ministry wanted to expand its coverage to include African countries against the earlier proposal to include just Latin American countries.

The revenue department was opposed to expanding the scope of the scheme on account of revenue loss. The scheme was then referred to a committee of secretaries which allowed it to cover other countries on the condition that the revenue forgone under it would not exceed Rs 600 crore per year.

Countries of Latin America covered under the scheme include Argentina, Bolivia, Chile, Ecuador, Paraguay, Peru, Uruguay and Venezuela.

Some African countries which would be covered include Angola, Benin, Botswana, Burundi, Cameroon, Ethiopia, Chad, Lesotho, Libya, Liberia, Mauritius, Morocco and Zambia.

"The outgo under the scheme will not increase as only those countries will be included to which India's exports are less than $200 million per year. Hence, countries like South Africa or Tanzania will not be covered under the scheme," an official said.

Under the Focus Market Scheme, exports of all products barring a negative list, are entitled for duty credit scrip equivalent to 2.5 per cent of the freight on board value of exports for each licensing year commencing from April 1, 2006.

The scrip and the items imported against it would be freely transferable.

Items like diamonds, semi precious stones, gold, silver, ores and concentrates, cereals, sugar, crude and petroleum-based products have been excluded from the scheme's coverage.