The centre is considering an incentive package to exporters in view of ''sluggish domestic demand and competition in export markets,'' reports quoting commerce ministry officials said.
Commerce minister Suresh Prabhu is reported to have written a letter to finance minister Arun Jaitley for an early decisions on key issues affecting exports, such as inadequate incentives and lack of credit.
Prabhu has called for a meaningful mid-term review of the foreign trade policy (FTP), involving a number of critical export promotion measures, which would involve an additional outgo of over Rs16,000 crore, have been placed by Prabhu before Jaitley for consideration and early decision-making, the HinduBusinessLine quoted a government official as saying.
The proposed measures include allowing the scrips earned under the popular Merchandise Exports from India Scheme (MEIS) to be used to pay goods and services tax (GST), increasing the incentive rates and interest subsidy rates for labour-intensive sectors, reducing the GST rate on MEIS/SEIS scrips, and infusing more capital in the Export Credit Guarantee Corporation of India (ECGC).
''We have already delayed announcement of the mid-term review of the FTP as exporters were grappling with GST issues till recently. The finance minister has to now take a view on the incentives that could be extended to give exports a much-needed boost. A meaningful FTP review has to be announced without further delay,'' the report quoted the official as saying.
The commerce ministry is reported to be working on mechanisms to further speed up the GST refund process for exporters,.
"We are evolving a mechanism. We are trying to further reduce time for refunds," minister of state for commerce and industry CR Chaudhary told the media on the sidelines of the inaugural session of the 186th AGM of the Calcutta Chamber of Commerce.
In a relief to exporters, the government recently announced that it would immediately refund exporters for the month of July and August through cheques from October 10 and October 18, respectively.
Following a GST Council meeting, union finance minister Arun Jaitley told reporters that this would be an interim relief, and as a long term measure e-wallets will be created for all exporters by 1 April 2018, to carry forward the refund process.
Chaudhary said large scale reforms like GST will often lead to hiccups and inconvenience during inception but it will be beneficial in the long run.
"Rise in export data for September shows that initial hiccups of GST roll out is stabilising," he added.