New Foreign Trade Policy (FTP) extends 2% export benefits to category ‘C’ countries, as is given to category ‘A’ and ‘B’ to the Indian Ferro Alloy Industry for exports to these countries.
The government has broadened the ambit of its Merchandise Exports from India Scheme (MEIS) and Indian Ferro Alloy exports to all countries, which will be eligible for export incentive of 2%, effective from 5th May 2016.
What is MEIS?
Earlier, there were 5 different schemes under Foreign Trade Policy, 2009-2014 such as Focus Product Scheme, Market Linked Focus Product Scheme, Focus Market Scheme, Agri and other. Now, all these schemes have been merged into a single scheme namely Merchandise Export from India Scheme (MEIS) under Foreign Trade Policy, 2015-2020.
How will it work for Ferro Alloy Industry?
Earlier, Indian Ferro Alloy exporters were used to get an incentive of 2% and 1.4% Duty Draw Back, for countries falling under category ‘A’ and category ‘B’. Now, category ‘C’ countries will also be eligible for an incentive of 2%. Total rebate for exporting Ferro Alloys is now 3.4% (2% under MEIS & 1.4% duty drawback). However, this latest development of extending export benifit for exports to Category ‘C’ countries will have little or no impact in reversing the slide in the country’s outbound Ferro Alloy shipments as India exports very little to Category ‘C’ countries.
Categorization of Countries
Category A consists of 30 traditional markets — 28 countries of the European Union, Canada and US. While, category B consists of 139 emerging and focus markets – 55 African countries, 45 countries from Latin America and Mexico, 12 CIS countries, 13 West Asian countries and Turkey, 10 Asean countries, Japan, South Korea, China and Taiwan. All other 70 markets are placed under category ‘C’ which consists of countries like Pakistan, New Zealand, Bangladesh, Afghanistan, Bhutan, Albania, Mongolia, Sri Lanka, Panama and Australia.
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