Kamal Nath's export package - has the PM's backing - Service Tax issue yet to be sorted out

By Vijay Kumar

Are the Ministries of Commerce and Finance not on talking terms? Why should the Commerce Minister invoke the PM's name for all his policies, which the Finance Ministry refuses to even acknowledge let alone accept? They seem to have sorted out some of the issues. Service Tax on exports is yet to be sorted out.

The Commerce Ministry has announced a package, the highlights of which are :-

1. DEPB rates have been enhanced by 3% for 9 sectors i.e., textiles (including handloom), readymade garments, leather products, handicrafts, engineering products, processed agricultural products, marine products, sports goods and toys. For the rest of the items, DEPB rates have been enhanced by 2%.

2. ECGC premium has been reduced by 10% of the existing premium rates.

3. To clear all arrears of terminal excise duties and CST reimbursement, an amount of around Rs.600crore has been released.

4. The rates of duty drawback has been enhanced by around 10 to 40% of the existing rates.

5. The rate of interest on pre and post-shipment credit has been reduced by 2%.

Details of the schemes are given below: