A. The EXIM Policy 1997-2002 released on 31-3-1997, decentralised the licensing powers for consideration of EPCG Application as follows;

CIF Value Competent Authority

Upto Rs. 2 crore Regional EPCG Committee

Above Rs. 2 crore and

upto Rs. 10 Crores Zonal EPCG Committee

Above Rs. 10 crores but

below Rs. 20 crores Headquarters EPCG Committee

All applications for Zero duty Committee of Secretaries on the

EPCG Scheme recommendation of Hqrs. EPCG

Committee.

Even though DGFT has decentralised the licensing powers, if a technical member is not provided in the Regional/Zonal EPCG Committee, then the implementation of the EPCG Scheme becomes difficult. So also is the case if the Port Offices authorised to issue EPCG licence do not have a technical member for the electronic or IT Sector.

B. The Exim Policy 1997-2002 (Incorporating amendments upto 13 April 1998) announced on 13-4-98, further decentralised submission of all EPCG applications and issuance of licenses by Regional Licensing Authority. However, for applications above value of Rs. 10 crores, a copy of the application is to be submitted to DGFT, Delhi, who will in turn, forward the recommendations to the Regional Licensing Authority for issue of licenses against original application submitted to Regional Licensing Authority.

In the absence of any technical member at DGFT Office, delay in issue of license is considerable. The EPCG licenses are now on zero duty and imports that are made by STP, EPZ, etc. are also at zero duty but have an approval process. For a hassle free environment, it is recommended that the system should be for DGFT to issue licenses on request with the bond for export commitment.

4.2 EXIM Policy related Issues

Amendment in negative list of import for computer systems:

At present computer systems, including personal computer, below CIF value of Rs. 1.50 lakhs are under negative list of import and the imports are permitted against SIL under the following classification:

847130 01.10
847141 01.10
847149 00.10
847150 00.10
847180 00.10

With a view to increase the PC penetration, it is recommended that the value limit for computer systems including personal computer may be reduced from Rs. 1.50 lakhs (cif) to Rs. 50,000.

4.3 Benefits to private infrastructure and common facilities/service providers

In the Custom Notification No. 138/91 dated 20.10.90 as amended from time to time, allows import of duty free capital goods for creating central facility to Software Technology Parks of India (STPI) and do not include other service providers in the private sector. With the advancement of technologies in electronics and computer software, the cost to create such infrastructure required for export is becoming exorbitant. Therefore, it is necessary that private and public organisations interested in providing infrastructure/common facilities should also be included for duty exemption to import capital goods, etc. The Service Provider in view of capital imported would undertake the export obligations as provided for capital goods in the STP Scheme. The scheme was discussed in the DGFT/CBEC which need to be implemented immediately.

4.4 India Brand Equity Fund

This Scheme is operated by the Ministry of Commerce and should be made available for Software companies with much greater flexibility.