FM Nirmala Sitharaman announces new measures to boost exports, replaces MEIS with RoDTEP

Union Finance Minister Nirmala Sitharaman today announced new measures to boost exports, including the replacement of Merchandise Exports from India Scheme (MEIS) with the scheme for Remission of Duties or Taxes on Export Product (RoDTEP), while addressing a press conference in New Delhi. The finance minister also announced that fully electronic refund module for a quick and automated refund of input tax credits will be implemented by end of this month.

According to Nirmala Sitharaman, "Scheme for Remission of Duties or Taxes on Export Product (RoDTEP) will replace MEIS. Existing dispensation in textiles of MEIS and old RoSL (Rebate on State Levies) will continue up to December 31 this year." '

She said that textiles and all other sectors, which currently enjoy incentives up to 2 per cent over MEIS will transit into RoDTEP from January 1, 2020, adding "In effect, RoDTEP will more than adequately incentivise exporters than existing schemes put together."

She added that the revenue foregone on account of the measure projected to be about Rs 50,000 crore.

There will be fully automated electronic refund route for input tax credits (ITC) in GST, said said, adding "Fully electronic refund module for a quick and automated refund of ITC is nearing completion and will be implemented by end of September 2019. This is expected to monitor and speed up ITC refunds."

While beginning her address to the media, she said that inflation is under control and there is a clear sign of revival of industrial production. The FM said inflation in the range of 2.5 to 4 per cent is considered safe and it has been held under four per cent.

Referring to industrial production, she said there was clear sign of revival in the first quarter of 2019-20, adding "Revival of fixed investment is also showing a positive picture."

The minister said there was also a clear sign of revival of Foreign Direct Investment, as reserves have gone up in August-end and one of the best-level of reserves was being maintained.

Earlier on August 30, the government had announced the mega-merger of 10 PSU banks into four entities, where the Punjab National Bank, the Oriental Bank of Commerce and the United Bank would merge to become the second-largest public sector bank (PSB), while the Canara Bank and the Syndicate Bank will amalgamate to set up the fourth-largest PSU banking entity. The country will now have 12 state-run banks instead of 27.

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The four new state lenders will have businesses worth Rs 55.8 trillion ($781 billion), or about 56 per cent of the Indian banking industry, Finance Minister Nirmala Sitharaman had said at a briefing, adding that the government would inject a combined Rs 55,250 crore into these entities.