Labour-intensive export sectors get R1050-cr stimulus | business | Hindustan Times
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Labour-intensive export sectors get R1050-cr stimulus

The government on Monday announced a R1,050 crore incentive package to labour intensive sectors such as handicrafts, handlooms and leather goods amid rising concern about a possible demand slump in two of India's biggest export markets — the US and Europe. HT reports.

business Updated: Aug 23, 2010 22:40 IST
HT Correspondent

The government on Monday announced a R1,050 crore incentive package to labour intensive sectors such as handicrafts, handlooms and leather goods amid rising concern about a possible demand slump in two of India's biggest

Year-long push

The incentive schemes will be effective from April 1, 2010.

Interest subsidy of 2%, currently available for handicrafts, handlooms, carpets and small and medium enterprises, is being extended for a number of specified productsfor the current financial year.

The Duty Entitlement Pass Book scheme has also been extended for six months, or till June 30, 2011.

export markets — the US and Europe.

"To give immediate relief, a bonus incentive is being provided to sectors whose exports are still not doing well," commerce and industry minister Anand Sharma said while anno-uncing the annual supplement to the foreign trade policy.

This covers sectors such as handicrafts, handlooms, silk carpets, leather and leather manufactures, sports goods, toys and some bicycle parts.

"This bonus incentive is in addition to the package announced earlier," said commerce secretary Rahul Khullar.

The incentive schemes will be effective from April 1, 2010.

The facility of interest subsidy of two per cent, currently available for handicrafts, handlooms, carpets and small and medium enterprises, is being extended for a number of specified products pertaining to leather and leather manufacturers, jute manufacturing, including floor covering, engineering goods and textile sector for the current financial year.

"Whatever recovery has been there is stimulus-fed and stimulus-led," Sharma said, adding that it was posing challenges to Indian exporters.

To provide relief to exporters hurt by global slowdown, Sharma announced extension of the DEPB (Duty Entitlement Pass Book) scheme for six months or till June 30, 2011.

The government reimburses taxes paid on imported inputs that are used to produce goods that are exported.

The government also announced extension of zero duty export promotion for capital goods (EPCG) for one more year till March 31, 2011.