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Measures For Export Promotion

The major export promotion measures taken by the government over the years are discussed below:

(i)    Export Processing Zones (EPZx). Several Export Processing Zones (EPZs) have been set up in different parts of the country to provide an internationally competitive duty free environment for production for exports. The units situated in an EPZ are allowed to make duty free import of all types of goods required by them for the manufacture of goods and services meant for export. In other words, such units are not required to pay nay import duty on the imported capital goods, raw materials, components, spares and consumables, office equipment, etc. to be used for production of goods meant for export.

(ii)    Special Economic Zones (SEZs). Special Economic Zones have been set up with a view to encourage free trade up with a view to encourage free trade for the purpose of promotion of exports. A Special Economic Zone is a specifically delineated duty free enclave and shall be deemed to be foreign territory for the purposes of trade operations and duties and tariffs. Goods going into the SEZ area purposes of trade operations and duties and tariffs. Goods going into the SEZ area shall be treated as deemed exports. Goods coming form the SEZ area into DTA (Domestic Tariff Area) shall be treated as imported goods.
In any SEZ, goods may be imported or procured from DTA without payment of duty for the purpose of production, processing, repair, reconditioning, packaging etc. fo goods for export.

(iii)    Export Oriented Units (EOUs). The scheme of 100 per cent export oriented units (EOUs) was launched by the Central Government in 1980. Such units have been set up fo the export of their entire production excluding the rejects and items specifically permitted to be sold in the domestic market. They can be established anywhere in the country. That means, the export oriented units may be established in the export processing zones or outside the zones. The 100 per cent EOUs located in export processing zones are known as EPZ units. The EOUs are allowed to import capital machinery, materials and other things of the purpose of export production without payment of any import duty.

(iv)    Recognition of Export Houses. Under the Exim Policy, the Central Government gives recognition to export houses to encourage creation of marketing structure and expertise required for export promotion. Depending upon their contribution to export promotion, they are recognized as Export TRADING Houses, Star Trading Houses and Super Star Trading Houses. Such export houses function as highly professional institutions to undertake exports of goods produced in the country.

(v)    Recognition of Export of Services. In order to encourage export of services, the Government has launched the scheme of recognizing various categories of services houses. They are recognized on the basis of the export performance of the service providers. Based on their export performance, they are recognized as service export house, International service export house are recognized as service export house, international service export shouse.Internatial start service export house and international super service export house.

(vi)    Export Promotion Capital Goods Scheme. New capital goods including computer software systems may be imported under the Export promotion Capital Goods (EPCG) Scheme. Under this, goods including jigs, fixtures, dies, moulds and spares may be imputed at 5% customs duty. This import is subject to an export obligation equivalent to 5 times CIF (cost, insurance and freight) value of capital goods on FOB (free on board) basis to be fulfilled over a period of 8 years. Import of capital goods shall be subject actual user condition till the export obligation is completed.

(vii)    Deemed Exports. Goods supplied by business units to the export oriented units (EOUs) or export processing zones (EPZs) are treated as deemed exports even through the goods supplied do not leave territories fo the country. Deemed exports are eligible of the following benefits:

(a)    Advance license for deemed export.
(b)    Refund of terminal excise duty.
(c)    Deemed exports duty drawback.

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