New Delhi, September 2
The authorities’s resolution to cap export incentives below Merchandise Exports from India Scheme (MEIS) at Rs 2 crore per exporter on outbound shipments made throughout September-December, 2020 goes to “seriously” have an effect on merchants, FIEO mentioned on Wednesday.
Federation of Indian Export Organisations (FIEO) president Sharad Kumar Saraf mentioned exports that shall be made throughout September-December, 2020 are primarily based on the orders, which have already been negotiated a lot earlier, factoring the present MEIS profit.
These advantages are a part of the export competitiveness and subsequently the sudden change will have an effect on the exporters’ financially as consumers are usually not going to revise their costs upward, he added.
“However, the sudden imposition of a cap of Rs 2 crore per IEC (Import Export Code), on MEIS benefit of exports made during September 1 to December 31, 2020, is going to seriously affect exporters, whose numbers may not be very large, but their contribution to exports warrant a revisit to the imposition of the cap,” Saraf mentioned.
The authorities on Tuesday capped export incentives below the scheme at Rs 2 crore per exporter on outbound shipments made through the interval from September 1 to December 31, 2020.
He additionally expressed concern over the monetary outlay of Rs 5,000 crore given for exports throughout September-December, 2020 with the situation that if claims exceed this restrict, the ceiling might additional be revised downwards.
“This will create huge uncertainty as those eligible for a cap of Rs 2 crore will not be able to factor even such benefits in their exports. Clarity is also required whether any change in the MEIS rate will be notified for those who are not affected by the cap if the amount of Rs 5,000 crore is exhausted,” Saraf mentioned. — PTI