Following three rounds of discussions between senior officials from the commerce and finance ministries on one hand and between finance minister Yashwant Sinha and commerce minister Ramakrishna Hegde on the other in the past few days, indications are that all the existing export-promotion schemes will be retained with procedural simplification.

The schemes include DEPB scheme, EPCG scheme, duty-exemption scheme, hundred per cent export-oriented units (EOU) scheme and export/trading/star trading/super star trading house scheme. There is, however, a question mark overthe continuation of the 10 per cent duty EPCG scheme. Earlier, it had appeared that the scheme would be scrapped going by the stand taken by the finance and commerce ministries that it had lost the shine owing to depressed demand at home.

With just two days left for the revised policy to be unveiled, the possibility of the commerce ministry coming out with innovations to lift the sagging morale of the exporting community is rated high. A case in point is the new export-processing zones to be set up in the country modelled on the lines of UAE. The commerce ministry is also trying to phase out the entire list of restricted items or at least a substantial portion of these in accordance with the country's commitment to the World Trade Organisation (WTO).

At present, about 2,400 items are still in the restricted list of which half is allowed to be imported through the special import licence (SIL) route. The remaining 50 per cent items are to be shifted to the SIL and the freely importable list in phases up to2002 as per the commitment. Already, around 8,000 restricted items have been transferred to the free list. So far, DEPB rates for more than 2,000 export items based on standard input-output norms have been notified by the Government. There is, however, no move to enhance the export list. The rates are, however, proposed to be revised from May 1, taking into account the changes in the duty structure notified in the 1999-2000 budget.

There does not appear to be any scope for pruning the canalised list of import items in the existing policy. A very large number of such items were taken out of the purview of canalising agencies and allowed to be imported under OGL after the economic reforms were initiated in 1991.

During the official-level talks, the commerce ministry had pressed the finance ministry to reduce the threshold limit of Rs 20 crore under the EPCG scheme to Rs 1 crore to cover all the sectors. But the suggestion appeared to have not found favour with the finance ministry on grounds of loss ofrevenue.

Following changes in the exim policy announced on April 13, 1998, the zero-duty EPCG scheme was reduced to Rs 1 crore for seven key sectors - garments electronics, gems and jewellery, sports goods, leather, toys and agro and food processing.

Subsequently, the benefit was also extended to certain specified engineering sectors like machine tools, automotive components and accessories, bicycle parts and accessories, hand tools, cuttings and small tools, castings and forgings, pumps, electric motors, fasteners, bright bars and shaftings and scientific and surgical instruments.