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Export provisions of ftp advantages??

lavanya (student) (958 Points)

20 March 2017

Do you think export provisions under FTP facilitate export from India? Give ur arguments..

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Ajit Hegde (CA - Final) (1367 Points)
Replied 22 March 2017

Definately yes! I'm talking about incentives under FTP provisions. Before 2011, there was a scheme called DEPB which provided incentive ranged from 5℅ to 30℅ to exporters. Many of the exporters lived on this incentive rather than their margins! Later the WTO objected to it since no other countries could competete against Indian prices and quality. Hence the scheme was called off.

Even now there are incentives ranging from 2℅ to 5℅. For some of the sectors this is the margin what they earn, hence doubling the benefit to such exporters. Also there are duty free imports for those who are engaged in exports.

In addition you have schemes like Export House status recognition etc. which will facilitate smooth doing of business by reducing the statutory complaince requirements to the exporter.

Provisions are meant to facilitate exports. However, awarness of these benefits is very low among mid sized or small scale producers.

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