New Delhi, Jun 6: Making a strong demand for availability of steel at international prices to exporters, Engineering Export Promotion Council (EEPC) India, brought out several key issues affecting exports, including the recent US decision to end preferential trade treatment for India under the Generalised System of Preferences (GSP), at a review meeting with Commerce and Industry Minister Piyush Goyal here on Thursday.
Goyal chaired the joint meeting of the Board of Trade and the Council for Trade Development and Promotion, interacting with a large community of exporters and stakeholders.
EEPC vice-chairman Arun Garodia said the US decision would "hit Indian exports hard particularly in sectors such as engineering goods, chemical products and other labour-intensive sectors. The removal of these duty concessions would make the majority of products relatively uncompetitive in terms of prices in the US market compared to exports from other developing countries".
Raising the issue of of high prices of domestic steel as compared to international market, Garodia said high cost of the crucial raw material resulted in non-competitiveness of Indian downstream engineering exports.
On May 15, a meeting was held in Ministry of Steel where it was decided to form a xommittee under DGFT to look at this issue , which deserve the utmost priority. In the backdrop of the US preferential treatment being withdrawn, 'it is critical that our exporters get steel at international prices and we request the Government to address this issue at the earliest."
The EEPC India also briefed the new minister about the protectionist measures being faced by the engineering exporters in the European Union market.
The other big obstacles for exporters included uncertainties arising out of WTO compatibility for incentive schemes like Merchandise Exports from India Scheme (MEIS) and interest equalisation scheme. "
Besides, small exporters to OFAC countries like Iran, Syria, Saudi Arabia faced major problem due to caution caution listed by the RBI.
Mr Garodia also referred to the issues of customs procedures and facilitation. He said the Gujarat Court has struck down the pre-import condition under the Advance Authorisation scheme to avail IGST exemption. A large number of DRI cases were filed against exporters and demands for IGST payments were made.
He said there were still past problems with regard to GST refunds pertaining to July- September 2017. Issues like the problem of higher or identical duty drawback taken during the transition period needed to be resolved.
The other issues brought in the review meeting by EEPC India related to lack of clarity with regard to IGST on supplies from the Special Economic Zones to the domestic tariff areas. Exporters also wanted adequate credit and finance at lower interest rates even as the collateral requirements for small exporters made them uncompetitive.
The investment in plant and machinery limits should be raised to Rs 50 crore or the turnover based definition of MSME should be introduced as soon as possible, according to a statement here.