Modi government announces Rs 50,000 cr export incentive scheme

The announcement comes in the backdrop of India's merchandise exports declining by 6.05 per cent to USD 26.13 billion in August compared to the year-ago month.

Finance Minister Nirmala Sitharaman. (Photo | Shekhar Yadav, EPS)

Finance Minister Nirmala Sitharaman on Saturday announced a new scheme -- Remission of Duties or Taxes on Export Product (RoDTEP) -- to incentivise exporters at an estimated cost of Rs 50,000 crore to the exchequer.

The announcement comes in the backdrop of India's merchandise exports declining by 6.05 per cent to USD 26.13 billion in August compared to the year-ago month.

The minister also said there will be a fully automated electronic refund route for input tax credits (ITC) in GST.

This will be implemented by the month-end. The move, she added, is aimed at quick and automated refunds of ITC.

She said RoDTEP will replace the existing incentive schemes and "will more than adequately incentivise exporters than the existing schemes put together".

The minister said the revenue foregone towards the scheme is projected at Rs 50,000 crore.

Sitharaman said her ministry is taking strong measures for improvement of credit outflow from banks and revival of growth and uplift of consumer sentiment. 

Transmission of interest rate cuts being effected by banks,  Sitharaman added.

Other highlights:

• The FM said inflation is under control and there is a clear sign of revival of industrial production.
   
• Clear sign of revival in FPI flow
   
• Investment rate going upward
   
• Remission of duties/taxes on export products
   
• Higher insurance cover to banks supporting exports
   
• India to hold annual mega shopping festivals like Dubai Shopping Festival to boost exports
   
• Govt to cut turnaround time in ports, airports via the use of technology: FM on steps to boost exports
   
• Rs 36,000 cr to Rs 68,000 cr of credit will be available for exports after priority sector lending tag
   
• Fully automated electronic refund route for input tax credits in GST
   
• Rs 50,000 cr revenue will be foregone with the introduction of remission of duties or taxes on export products
   
• Special window to provide last mile funding for housing projects that are non-NPA and not under NCLT; govt to provide Rs 10,000 cr
   
• Interest on housing building advance to be lowered