Exports incentives linkage - Did DEPB matter?
This blog has emphasized many times about the importance of establishing the linkages between exports performance to incentives provided by the Government. The urgency of this hit me when I went to a customs commissionerate on an attachment. The perspective on export incentives, when seen from the revenue angle, is different to, when seen from export promotion angle. The revenue collectors look at such schemes as a loss in revenue. During one such talk and presentation given by a senior customs official, the officer said that removal of DEPB scheme had no impact on exports. Upon prodding, he came up with numbers and showed that the exports had remained same, or increased in some areas, after the DEPB scheme was withdrawn. So, he concluded, DEPB had no impact on exports performance. DEPB was an export incentive scheme launched with an intention of offsetting the duties incurred on the inputs that go into export products. Drawback is another such scheme, with similar intent of du