Amendment in the Subsidy Procedure; 8% Subsidy to Exporters Over Rs.50 Crore

The export subsidy mentioned in the budget has received cabinet approval. The reform of the export subsidy procedure that was recommended by the Ministry of Industry, Commerce, and Supply has been approved.

The amendment Proposal was adopted at the Council of Ministers meeting on last Friday, according to Finance Minister Janardan Sharma. Sharma had promised to offer an up to 8% discount on exports through the budget in order to boost exports at a time when imports are rising.

The budget for the fiscal year 2079–80 states that those that identify and export services with high export potential, such as clinker, cement, steel, footwear, treated water, IT-based services, and business process outsourcing, will receive an export subsidy of 8%.

In line with Minister Sharma's strategy, a plan to alter the procedure within Jestha itself existed. However, the Ministry of Commerce delaying the procedure only made the issue worse. In fact, some cement manufacturers have started exporting without approval of the subsidy procedure.

The minimum subsidy is set at 4% in accordance with the process. However, not all goods receive subsidies. The procedure's requirements must be satisfied. Here are some of the requirements for the subsidy procedure.

• The exported items must have a 30% value addition in order to receive 4% subsidy. The subsidy is not available if the value added is less than that. The company will receive a 5% subsidy if they add value by up to 50%.
• In a similar vein, such company will receive a 6% subsidy if there is a 70% increase in value. Similar to this, a business that exports after being registered in a national collective trademark is eligible for an export incentive of up to 7%.
• Similar to this, it will qualify for a subsidy if it exports 20% more than it did the previous fiscal year. A corporation that exports more than Rs. 50 Crores also receives a direct 8% subsidy on all subsequent exports. However, the restrictions will be in place for the first Rs. 50 Crores.
• The industrialist must follow the protocol and submit an application to the industry department in order to receive a subsidy. In 2075, a mechanism was put in place by the government to boost exports and decrease the trade deficit. This process has been changed by the government once. The protocol states that export commodities now receive a five and three percent subsidy according to their nature.

The amount of the export subsidy will be given to the industrialist based on the Industries Department's proposal. Despite the fact that 26 commodities are covered by the export subsidy, not all exporters have been successful in receiving it.

This is how the grant will be accepted;

• Businessmen must submit an application for export subsidies by filling out the form in accordance with the specifications provided by the industry department. The quantity of items shipped by the business and the volume of money imported when filing an application should be disclosed.
• The department will check the application submitted in this manner. The department will then engage with regional and national banks after that, based on which the exporter will receive the requested amount.