The government is planning tax incentives in the forthcoming Union Budget and the foreign trade policy (FTP) for several niche service sectors to boost output and exports, commerce and industry minister Nirmala Sitharaman said on Tuesday. Besides, the government plans to liberalise legal, education and healthcare services to attract more foreign investment.
The focus service sectors of the Narendra Modi government are IT, ITeS, telecom, healthcare, education, logistics, media, entertainment, professional services, tourism, space, research and development as well as capacity-building for SMEs.
The FTP could contain more incentives including greater coverage of the ‘Served From India Scheme’ (SFIS). SFIS gives a duty credit scrip equivalent to 10% of free foreign exchange earned during a fiscal by an eligible service providers (companies with free foreign exchange earning of at least R10 lakh in a fiscal year; for individuals, R5 lakh).
The policy will most probably be announced in March.