Recent announcements by Union Finance Minister to boost exports

On September 14, 2019, the Union Finance Minister Nirmala Sitharaman unveiled third booster to revive the economy. These announcements relate to various measures to boost the exports.

This update is to apprise you the key measures announced regarding the export incentive schemes.

Replacement of MEIS with RoDTEP

• There has been a long-standing dispute between India and WTO that various export incentives schemes like Merchandise Export Incentive Scheme (‘MEIS’) granted to incentivise exports, are not compliant to WTO guidelines.
• The scheme Remission of Duties or Taxes on Export Product (RoDTEP) will replace existing schemes of MEIS and Rebate of State and Central Taxes and Levies (‘RoSCTL’) [latter applies to textile products]. RoDTEP will extend to all sectors and cover all goods.
• Notably, existing MEIS and RoSCTL schemes will continue till December 31, 2019 and new RoDTEP scheme will come into effect from January 1, 2020.

NITYA Comments:

The Finance Minister has announced that the quantum of benefits under RoDTEP will incentivize exporters more than existing schemes. Consequently, the new scheme will increase competitiveness of exporters. Further, this is a clear indication that other export incentives like Advance Authorisation / DFIA / Duty Drawback, EPCG, SEIS etc. are likely to continue as it is.

Fully automation of GST refunds (input side)

• The process of refund of input tax credit shall be fully automated by end of September 2019 and will speed-up refunds.

Leveraging technology for timely completion of export processes

• New digital system will be introduced to eliminate offline / manual services and further reduce ‘Time to export’ i.e. overall time consumed in completing export processes. The process will be benchmarked to international standards. An action plan is expected to be implemented by December 2019 in airports and ports.

Spreading awareness about FTAs

• The Government will work with Federation of Indian Export Organization (‘FIEO’) and export houses to create awareness about various benefits available to exporters and importers like preferential duty benefits to MSMEs, benefits under FTAs to importers and exporters, etc.

Online ‘Origin Management System’

• DGFT in collaboration with Exports Inspection Council, will launch an online Origin Management System under Certificate of Origin Rules, enabling exporters to obtain Certificate of Origin online.