Union Budget 2023: The announcements for tweaking customs duties in certain sectors and measures to support MSMEs will help in boosting domestic manufacturing and the country’s outbound shipments, exporters said on Thursday. Increase in capital investment outlay by 33 per cent to Rs 10 lakh crore, 50 years interest free loan to states to incentivise infrastructure investment, highest-ever capital outlay for railways, several infrastructure projects in port, coal, steel will have a multiplier effect on economy and employment, they said.
Federation of Indian Export Organisations (FIEO) President A Sakthivel said that many of the changes in the customs duties will help to provide competitiveness to manufacturing and exports, besides attempting imports substitution. The reduction in duty on denatured ethyl alcohol and crude glycerine will help the downstream users in the chemical sector, the cut in duty on key inputs for producing shrimp feed will help the marine exports as will be the drop in duty on seeds for manufacturing lab-grown diamonds and R&D grant for the same to facilitate gems and jewellery exports, Shakthivel said.
Sharing similar views, Sanjay Budhia Chairman – CII National Committee on Exports and Imports and managing director PATTON Group said that the announcement of reduction in custom’s duty for select sectors shall improve India’s participation in global value chain (GVC).”There are quite a few changes in the customs duties that would improve competitiveness in manufacturing and exports. The cut in customs duty on the import of certain important sectors like inputs for mobile phone manufacturing would help in boosting value added exports,” Budhia said. He added that even while the global economy slows down, measures like this would help India continue to stand in a sweet spot and to build its exports in days to come.
“The announcement of establishing a subsidiary of Exim Bank for Trade refinancing would hugely help to address the concern of access to finance for exporters due to slow uptake of credit,” Budhia added. Yogesh Gupta, Regional Chairman, FIEO Eastern Region too said that revamping the credit guarantee scheme by infusing Rs 9,000 crore and reduction of 1 per cent interest for MSME will help exporters.
“Reduction of import duty on inputs will also make exports of finished goods more competitive. Reducing import duty on shrimp feed will give a huge boost to the Eastern region marine product exporters,” Gupta said. Lakshmi Venkataraman Venkatesan, Founding and managing trustee of BYST, said that the outlay of Rs 9,000 crore for credit guarantee scheme is a welcome move and this should hopefully help banks to be more willing to lend larger amounts in the form of business loans.