After having sounded the death knell for the duty entitlement passbook (DEPB) scheme, the popular among exporters, the finance ministry has now caved in to exporters' demands and agreed to extend it for three months beyond the 30 June deadline.
In various press interactions over the weekend, union commerce and industry minister Anand Sharma said the finance ministry has agreed to extend the scheme one more time, but this would be the last extension.
"The two departments (commerce and finance) will now finalise a new scheme to replace DEPB," Sharma said.
The decision to extend DEPB was taken at a meeting early this week between Sharma and finance minister Pranab Mukherjee. The finance ministry is reportedly firm on discontinuing DEPB, arguing that it allows the exporters double benefit instead of just neutralising the import duty on inputs that go into exports.
"We will not let the industry or exporters down. I had discussions with the finance minister a few days ago and he took onboard our concerns. So there is a three-month window created from 1 July during which the commerce and revenue secretaries would work out a scheme which is attractive to the exporters," the minister assured said.
It is not only big companies like Bajaj Auto, TVS Suzuki, Reliance Industries and Bharat Forge who will benefit from the extension. Even small-scale industries, including auto ancillary makers, have been clamouring for an extension of the scheme. (See: Industry body wants refund scheme on exports extended)