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Kolkata, September 20:
The Union commerce ministry has cleared the country's first free trade warehousing zone (FTWZ), which will come up at the port town of Haldia in West Bengal, additional secretary for commerce, GK Pillai, said.
He was addressing an open house of the Export Promotion Council (EPC) for export oriented units (EOUs) & special economic zones (SEZs) here Tuesday.
Initiation for the FTWZ will be taken after the notification for enforcing the Special Economic Zones Act-2005 is made. The Parliament had passed the Act on June 23 and its notification is expected to be made by the end of October this year, Pillai said.
Sudesh K Sonthalia, vice-chairman of EPC for EOUs & SEZ said, FTWZ will facilitate exporters duty-free warehousing. This implies that they will have to pay the duty for the volume of goods cleared up from the warehouse for export and not for the entire volume lying in the warehouse. This will save bank interest for the exporters and importers.
Apart from the FTWZ, Pillai said, the commerce ministry is going to facilitate exporters with the electronic data information (EDI) system. The system is being checked with the Director General Foreign Trade (DGFT), customs, banks and port authorities and is being implemented in phases.
The deadline for installing the system with all the authorities concerned is June 6, 2006, Pillai said.
The sunset clause, which deals with income tax of the EOU community, is being reviewed and the Government is considering its exemption. The central commercial tax (CST) imposed on the suppliers, under domestic tariff area (DTA), to SEZ will also be phased out over the next two years, Pillai said.
However, prior to declaring these facilities to the EOUs and SEZs, the Government has already extended bank guarantee (BG) relaxation, fast track scheme and CENVAT credit facility to the EOUs.
LB Singhal, director general of EPC for EOUs & SEZ, said prior to these facilities every EOU had to give BG to the customs irrespective of its turnover. But the relaxation has relieved the EOUs with Rs 5 crore turnover from giving BG to the customs house.
EOUs have started holding stars as mark of their status and are therefore put onto a fast track which simplifies various procedural aspects. The EOUs can also get their service tax back from the DTAs with the CENVAT credit facility extended to them, Singhal said.
All these facilities have lowered the operational and transaction cost of the EOUs, Singhal added.
Source : ExpressIndia.com
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