Representatives of the ailing export sector sought a slew of sops including a Rs.5,000-crore market development fund when they met Finance Minister Pranab Mukherjee and top officials on Tuesday as part of pre-budget consultations.
The exporters' wish-list, apart from the bailout package in the form of a market development fund, also includes elimination of the fringe benefit tax, income tax exemption, reduction of interest rates, and speedier insurance and service tax refunds.
"Exporters are passing through a difficult phase in view of the global slowdown," said A. Sakthivel, president of the Federation of Indian Export Organisations (FIEO) promoted by the commerce ministry.
"Income tax exemption for five years will help us reduce prices and remain competitive. The government should take immediate steps to prevent the sector from sinking further. Appreciation of the rupee has meant more gloom for us," Sakthivel told IANS.
Members of the Apparel Export Promotion Council (AEPC), who were also part of the meeting, asked for fresh investment of Rs.143,000 crore in the garment sector, apart from over 18 lakh sewing machines to be installed at the manufacturing units.
"We need to target $18 billion exports by 2015," AEPC chairman Rakesh Vaid said.
APEC has also asked for 50-percent capital subsidy for garment machines, an increase in the drawback rate, removal of fringe benefit tax and additional interest subvention.
India's merchandise exports fell last October for the first time in a decade, and missed the target of $200 billion set for fiscal 2008-09. Exports grew by a mere 3.4 percent to $168.7 billion, from $163.1 billion in 2007-08.