GS Paper 3
Topics Covered: Effects of liberalization on the economy, changes in industrial policy and their effects on industrial growth.
Government approves continuation of the National Export Insurance Account (NEIA) scheme and infusion of Rs. 1,650 crore Grant-in-Aid over 5 years.
Significance of the move:
Capital infusion in the NEIA will generate output from the vast potential of project exports in the focus market. The infusion can be seen as a part of different measures to provide a boost to the exports sector.
- The NEIA Trust was set up in 2006 to promote project exports from India that could be of strategic and national importance.
- The Trust promotes medium and long term (MLT)/project exports by extending (partial/full) support to covers issued by ECGC (ECGC Ltd, formerly known as Export Credit Guarantee Corporation of India Ltd) to MLT/project export and to Exim Bank for Buyer’s Credit (BC-NEIA) tied to project exports from India.
National Export Insurance Account (NEIA):
- It has been set up by the Government of India to facilitate medium and long-term exports, which are commercially viable, considering the limitations of the ECGC Limited in providing adequate cover on its own and non-availability of reinsurance cover to such exporters.
- NEIA aims to ensure the availability of credit risk cover for projects and other high-value exports, which are desirable from the point of view of national interest, but which ECGC is unable to underwrite at terms which will not affect the competitiveness of the exports.
Various Export Related Schemes and Initiatives taken by Govt. in last few years:
- Foreign Trade Policy (2015-20) extended upto 30-09-2021 due to the COVID-19 pandemic situation.
- Rs 56,027 crore released in September 2021 to liquidate all pending arrears under all script base Schemes to provide liquidity in the COVID-19 times.
- Roll out of a new Scheme – Remission of Duties and Taxes and Exported Products (RoDTEP). Rs 12,454 crore sanctioned for the Scheme in the FY 2021-22. It is a WTO compatible mechanism for reimbursement of taxes/ duties/ levies, which are currently not being refunded under any other mechanism, at the central, state and local level.
- Support to the textiles sector was increased by the remission of Central/ State taxes through the ROSCTL scheme, which has now been extended till March 2024.
- Trade Infrastructure for Export Scheme (TIES), Market Access Initiatives (MAI) Scheme and Transport and Marketing Assistance (TMA) schemes to promote trade infrastructure and marketing.