Exporters fail to verify value addition

KATHMANDU, NOV 8: 

Exporter’s failure to verify exact value addition to Department of Industry has kept them away from the cash incentive facility.

According to the exporters, the Cash Incentive Policy should be hassle free. Ministry of Commerce and Supplies (MoCS) along with Ministry of Industry is planning to resolve the issue to simplify the procedure. “The Cash Incentive Programme has been brought with a great effort,” said joint secretary at the MoCS Chandra Kumar Ghimire, said, adding that and it was brought to develop and promote the export sector.

“There are some procedural problems in the verification of value addition at the concerned department,” he added. “We are holding interministerial interaction to resolve the problems.”

The Cash Incentive Policy 2068 includes verification of value addition by the industrialist to get the cash incentive “but the industrialist are finding it difficult to verify value addition in their product,” said Ghimire.

According to the government criteria for cash incentive, if a product has a value addition of 30 per cent to 50 per cent, the exporter will get cash incentive of two per cent, whereas if the value addition is 50 per cent to 80 per cent, the exporter will get three per cent cash incentive, and value addition of more than 80 per cent will get a total cash incentive of four per cent.

But, cash incentive will only be granted to exports made in convertible currency and the exporters will get cash incentive from the same bank with which they are doing the transaction.

Finance Ministry has already deposited Rs 240 million in the Central Bank for the implementation of the cash incentive facility, however lack of sufficient value addition verification to the Department of Industry has made it difficult for the exporters to take advantage from it.

The central bank will deposit cash to their respective banks of the exporters claiming cash incentive to their respective banks. “But the Department of Industry has to certify value addition of exports claimed for the cash incentive,” he said, adding that the exporters have failed to verify exact value addition of their products due to complicated criteria of the policy.

The exporters have repeatedly complained about the confusing and complicated process of the Programme.