Need to rejig export incentives

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Jun 8, 2017, 2:42:52 AM6/8/17
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From: CUTS International


Need to rejig export incentives

Pritam Banerjee

The Hindu Business Line

June 06, 2017


Promoting sheer labour-intensive exports is passe. A PPP approach that focuses on skill-building at the MSME level is called for


Minster of State for Commerce, Nirmala Sitharaman recently announced that the review of foreign trade policy will be completed prior to July 1 when GST will be rolled out. This review is especially important since it is being done in an environment where India is under some pressure to move away from post-export incentives that are increasingly not compatible with WTO rules.


Besides incompatibility with WTO, giving incentive to a firm that is already exporting somewhat counter-intuitive as it is essentially rewarding a successful and therefore competitive exporter. Logically, investment in developing firm or sector level competitiveness requires support at the pre-export stage. Pre-export production-related subsidies and government support measures are more compatible with WTO rules and extensively used across the world.


Please read this article at:

https://goo.gl/IQrfC3


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