Amendments in MEIS to boost textile and apparel exports
Amendments in MEIS to boost textile and apparel exports
In the last few months, the growth of textile and apparel exports from
India had slowed down on account of various internal and external factors.
Realizing the turmoil that Indian exporters were facing in global markets, Shri
Santosh Kumar Gangwar, Union Minister of State for Textiles (I/C) had
recommended a number of corrective actions to the Ministry of Commerce and
Industry in consultation with industry stakeholders.
One of the major
recommendations was related to the enhancement of market coverage under
Merchandise Exports from India Scheme (MEIS). The Textiles Minister would like
to express gratitude to Smt. Nirmala Sitharaman, Minister for Commerce and
Industry, for taking due note of the recommendations and amending MEIS as
requested. The Export Promotion Councils and other trade bodies have also
appreciated this timely action, which will lead to improvement of textile and
apparel exports from India.
A Public Notice dated Oct 29, 2015 has been published by Director General
of Foreign Trade (DGFT) regarding extension in duty incentives under the
Merchandise Exports from India Scheme (MEIS). The duty benefit amendments as
part of the allocation have been increased from Rs 18,000 crore to Rs 21,000
crore for MEIS. Textile and apparel sector has emerged as one of the major
beneficiaries of the latest amendments in MEIS.
Launched in April 2015, the MEIS provided duty reward to eligible textile
and apparel categories to an extent of 2% of FOB value in countries falling
under Group A (Traditional markets - USA, EU-28 and Canada) and a single
country in Group B (Emerging markets) viz. Japan. Later in July 2015, the
scheme was amended wherein countries of Norway, Switzerland, Iceland and
Liechtenstein were shifted from Group C (other markets) to Group A and 2% duty
benefit was provided for fabric exports to Bangladesh and Sri Lanka.
Despite these additions, many important markets for yarn, fabrics, made-ups
and garments like Latin American countries, Russia and CIS countries, Turkey,
etc. remained uncovered for duty reward. Indian textile and apparel exporters
had been demanding a more comprehensive market coverage to set off the
disadvantage that they faced due to factors such as lack of FTAs with EU and
USA, and higher interest and power rates than competing countries. The recent
amendment in MEIS has addressed these concerns of industry, thereby improving
industry sentiments.
In the recent amendment, the country coverage for all eligible textile and
apparel categories has been extensively extended. Eligible categories under HS
Code Chapters 50 to 63 are now eligible for duty reward of 2% to all countries
of Group B, Group C and Group A countries. This means that the duty reward is
now available to textile exporters in any country globally. For eligible
apparel and made-ups categories under HS Code Chapters 61 to 63, the duty
reward has been extended to all Group B countries in addition to Group A
countries. Group B comprises of 140 countries covering important emerging
apparel and made-up markets like South Africa, Russia, China and Hong Kong,
East and West African countries, etc. Incentives in these additional markets
would prove extremely beneficial to exporters.
Related: Government Announces Enhanced Support for Export of Various
Products and Covers Some Additional Products Through Merchandise Exports from
India Scheme (MEIS)
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