Fin Min may withdraw fiscal incentives given to exporters

The Finance Ministry may withdraw fiscal incentives given to exporters to fix the budgetary hole, Commerce Secretary Rahul Kullar said in New Delhi on Wednesday.

The Finance Ministry may withdraw fiscal incentives given to exporters to fix the budgetary hole, Commerce Secretary Rahul Kullar said in New Delhi on Wednesday.

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"My fear is that North Block (Finance Ministry) guys are having a hard look (at the numbers) to fix the budgetary hole and easy target are exporters," Khullar told reporters.

Exports rebounded in November after contracting for 13-months in a row and the December figures could be a clincher, he said.

As far as the sectoral review by the Commerce Ministry is concerned, Khullar said that the exercises is not yet complete. The incentives given by the Commerce Ministry could also be reshuffled depending on the sectoral performance.

Due to the global slump in demand, India's exports were in the negative since October 2008. To boost shipments, the government has announced incentives that include 2 per cent interest subsidy and duty refunds on inputs used for exports.

Earlier on Wednesday, however, the government said the fiscal stimulus given to the industry at the height of the slowdown will not be withdrawn until the next budget to be presented by Finance Minister Pranab Mukherjee in February