Centre has been spending annually almost Rs 8,500 crore for reimbursing the exporters on the taxes paid on import equivalent to the content of export products, under the Duty Entitlement Pass Book (DEPB) scheme. The main beneficiaries are sectors such as engineering, automobile and chemicals.
It is quite popular among the Indian exporters due to its lucrative rates and also flexibility which are not available in the other refund mechanism - Duty Drawback. The exporters have been creating pressure that they should be permitted similar kind of benefits even if the nomenclature of the DEPB is altered.
The Union Finance Ministry has worked out a compromise between the DEPB and also Duty Drawback. The details of the scheme would be declared by Finance Secretary RS Gujral and the senior officials of the Central Board of Excise and Customs (CBEC).
Although exports have witnessed significant performance, surging by 54.2% between April-August 2011 to $134.5 billion, there are still concerns that the momentum won't be sustained due to the surging economic problems in US and also in Europe.
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