Export incentive remains distant mirage
KATHMANDU, DEC 31 -
The government’s incentive scheme designed to promote the flagging export sector has remained a distant mirage. Only two companies have benefited from the inducement package that was rolled out in the last fiscal year. The government’s indifference is exhibited in the activities of its executing agency, the Department of Industry (DoI), which has been forming and dissolving committees in the name of simplifying the procedure of distributing incentives.
The DoI has formed two committees within the space of a month. Responding to complaints from the private sector over delays in providing incentives, the DoI formed a six-member internal committee. The body formed under the coordination of Gopal Amatya, director of the DoI’s Planning Section, promised to accelerate the process of providing the incentive plan by removing procedural and bureaucratic hurdles. However, the committee didn’t last even a week as the DoI disbanded it and formed another three-member committee headed by DoI spokesperson Dhruba Lal Joshi.
“Due to the large size of the previous committee, it couldn’t perform as well as expected,” said Dhruba Lal Rajbanshi, DoI director general. “The committee is now rushing to provide incentives as soon as possible.” Amatya said that the committee was currently going through the documents submitted by companies applying for the incentives. “Once that is finished, the committee will start providing incentives,” said Amatya. The government had announced providing incentives in the last fiscal year’s budget to boost exports of goods having higher value addition. The DoI was then asked to initiate the process of providing incentive packages to applying companies.
Under the scheme, the government had promised a 2 percent cash incentive on the export of goods having a 30-50 percent value addition, 3 percent on goods generating 50-80 percent value addition and 4 percent on goods having more than 80 percent value addition.
Three months ago, the department provided the incentive package to two exporters—Annapurna Organic Krishi Udhyog of Arghakhanchi and the District Cooperatives Association of Gulmi.
A month ago, the department had promised to provide incentives to 11 firms within a week. The department had enlisted Triveni Spinning Mill, Triveni Synthetic Yarn, Continental Tea and Export and Narayani Modern Pulse Industry, Narayani Modern Manufacturing, Everest Art Paper, Popular Pashmina Fashion, Bikash Flour Mills, Adhunik Dal Udhyog, Dhana Laxmi Synthetic and Fishtail Rugs as eligible to receive the incentive.
However, the DoI hasn’t initiated the process. Dhruba Lal Rajbanshi, director general of the DoI, said that the DoI would be providing incentives to four companies within two weeks—Triveni Synthetic Yarn, Dhana Laxmi Synthetic, Bikash Flour Mills and Fishtail Rugs.
As of now, 34 firms have applied to the department for incentives, but none of them is sure about receiving them. DoI officials said the constant formation and dissolution of committees was nothing more than a ruse to fool industrialists.
“Neither did the previous committee work towards providing the incentive package and nor will the present committee do so,” said a senior DoI official, “It is all a plot hatched to ask for kickbacks from the industrialists before providing them incentives.”
Other officials have questioned the very motive behind forming committees. “Why do you need a committee when the incentive can be provided without it in a transparent manner?,” said one official.
Source: Kantipur
