Lok Sabha Question No. 55 (UNSTARRED), answered on 2017-07-17
Subject: Merchandise Exports from India Scheme
Ministry: COMMERCE AND INDUSTRY
Asked by: V. SATHYABAMA

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA

## UNSTARRED QUESTION NO. 55 TO BE ANSWERED ON 17 th  JULY, 2017

## MERCHANDISE EXPORTS FROM INDIA SCHEME

## 55.   SHRIMATI V. SATHYA BAMA:

Will the Minister of COMMERCE & INDUSTRY ( वािणÏय एवं उɮयोग मंत्री ) be pleased to state:

- (a) the details of various measures  taken  and  the  results  achieved  through  the Merchandise Exports from India Scheme under the Foreign Trade Policy since its introduction till date;
- (b) whether the Government has taken keen interest to boost the export of knitwear and readymade garments from Tirupur city of Tamil Nadu; and
- (c) if so, the details thereof and the measures implemented and the results achieved in this regard?

## ANSWER

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## THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (INDEPENDENT CHARGE) (SMT. NIRMALA SITHARAMAN)

- (a) The Merchandise Exports from India Scheme (MEIS)  is in operation since April 1, 2015  under    the  Foreign  Trade  Policy  (FTP)  2015-20.It  aims  to  incentivize  export  of merchandise  which  are  produced/manufactured  in  India.  The  scheme  covered  4914  tariff lines at 8 digit level. Subsequently, the coverage was widened and rates were enhanced for some of the tariff lines under MEIS. At present, 7914 tariff lines are covered under the MEIS Scheme.  The  projected  revenue  to  be  foregone  under  the  scheme  is  estimated  at Rs.23,500for 2016-17.

Initially, destination countries were grouped into 3 market categories -Country Group A,  Country  Group  B  &  Country  Group  C  with  differential  rate  of  MEIS.  Government  has extended  the  market  coverage  of  included  lines  to  all  countries  and  dispensed  with  the requirement of submission of Proof of Landing for exports w.e.f 04.05.2016. This step has been  taken  as  part  of  ease  of  doing  business  and  reduction  of  Transaction  Cost  of  the exporters.

From the data available(table below), it is seen that in Rupee terms, the exports of items covered under MEIS Scheme have grown by 11.64% during 2016-17 while the growth of exports for items not covered under MEIS was 2.86% during the same period.

| Category of Exports                                          |          2015-16 |          2016-17 | % growth Year On Year   |
|--------------------------------------------------------------|------------------|------------------|-------------------------|
| Export of items/ ITC(HS) Tariff lines covered under MEIS     | 990886           |      1.10621e+06 | 11.64%                  |
| Export of items/ ITC(HS) Tariff lines not covered under MEIS | 725492           | 746261           | 2.86%                   |
| Total Exports                                                |      1.71638e+06 |      1.85247e+06 | 7.93%                   |

Source: DGCI&S, Kolkata, 2017Figures in Rupee crore.

- (b). Tirupur is a Town of Export Excellence under Foreign Trade Policy. Government has announced  Special  Garment  Package  in  June  2016  which  is  applicable  to  Knit  wears  and garments. Further, GST on knitting job work has been kept at 5%.
- (c). (i). The details of the measures implemented by Govt. are as under:
1. 3%  Interest  Equalization  Scheme  for  manufacturer  exporters  of  readymade garments.( this scheme is also available to other sectors)
2. Integrated Skill Development Scheme
3. Amended Textile Up-gradation Scheme.
4. 2% MEIS scheme. ( this scheme is also available to other sectors)
5. All Industry Duty Drawback.
6. Details of Special package for employment generation and promotion of exports in Textile and Apparel sector.
-  Employee Provident Fund Scheme Reforms (12% Employee share of PF is supported by Govt.)
-  Introduction of fixed term employment
-  Additional  incentives  under  Amended  Technology  Up-gradation  Fund Scheme
-  Enhanced  duty  drawback  coverage  through Rebate of State Levies Scheme.
-  Special Advance License scheme under Foreign Trade Policy.
-  Enhancing scope of Section 80JJAA of Income Tax Act

## (ii). India's knitted garment exports growth is as below :

| India's Knitted Garment Exports   | India's Knitted Garment Exports   | India's Knitted Garment Exports   | India's Knitted Garment Exports   | India's Knitted Garment Exports   |
|-----------------------------------|-----------------------------------|-----------------------------------|-----------------------------------|-----------------------------------|
| Product Code                      | Product                           | Exports in USD Mn.                | Exports in USD Mn.                | Exports in USD Mn.                |
|                                   |                                   | 2015-16                           | 2016-17                           | %Growth                           |
| 61                                | Knitted Wear                      | 7,665.08                          | 8,266.95                          | 7.85%                             |
| Source: DGCI&S, Kolkata, 2017     | Source: DGCI&S, Kolkata, 2017     | Source: DGCI&S, Kolkata, 2017     | Source: DGCI&S, Kolkata, 2017     | Source: DGCI&S, Kolkata, 2017     |

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