Exporters Optimistic About Recent Customs Duty Adjustments Supporting MSMEs and Manufacturing Growth

Exporters have expressed optimism about recent announcements aimed at adjusting customs duties in specific sectors and supporting MSMEs. These measures are expected to enhance domestic manufacturing and boost exports. An increase in capital investment by 33% to Rs 10 lakh crore, along with a 50-year interest-free loan to states for infrastructure, is anticipated to significantly impact the economy and employment.

A Sakthivel, President of the Federation of Indian Export Organisations (FIEO), highlighted that changes in customs duties will enhance competitiveness in manufacturing and exports. The reduction in duty on denatured ethyl alcohol and crude glycerine will benefit the chemical sector. Additionally, lower duties on shrimp feed inputs and seeds for lab-grown diamonds will support marine and gems exports.

Sanjay Budhia, Chairman of the CII National Committee on Exports and Imports, echoed these sentiments. He noted that reducing customs duties in select sectors will strengthen India's role in the global value chain. Specifically, lowering duties on mobile phone manufacturing inputs will boost value-added exports.

The highest-ever capital outlay for railways and various infrastructure projects in ports, coal, and steel sectors are expected to have a multiplier effect on the economy. These initiatives aim to stimulate growth and create employment opportunities across the country.

Budhia also mentioned that despite a global economic slowdown, these measures position India advantageously to expand its exports. Establishing an Exim Bank subsidiary for trade refinancing is seen as a crucial step to address exporters' financing challenges amid slow credit uptake.

Support for MSMEs and Credit Schemes

Yogesh Gupta, Regional Chairman of FIEO Eastern Region, pointed out that revamping the credit guarantee scheme with a Rs 9,000 crore infusion and a 1% interest reduction for MSMEs will aid exporters. Lower import duties on inputs will make finished goods exports more competitive, particularly benefiting Eastern region marine product exporters.

Lakshmi Venkataraman Venkatesan, Founding Trustee of BYST, welcomed the Rs 9,000 crore allocation for the credit guarantee scheme. This initiative is expected to encourage banks to offer larger business loans, facilitating greater access to finance for businesses.

Overall, these strategic measures are designed to bolster India's manufacturing capabilities and export potential while supporting infrastructure development and MSME growth. The focus on reducing customs duties and enhancing credit access aims to position India as a competitive player in the global market.