The department related parliamentary standing committee on commerce in its latest action taken report tabled in the parliament has suggested early announcement of some sort of an incentive for service exporters in lieu of the scrapped Service Exports from India Scheme (SEIS).
In its report, the standing committee has said that the withdrawal of the incentive scheme for services exporters has adversely impacted the membership of Services Export Promotion Council (SEPC) and its revenues.
Noting that the surplus accrued from the service trade contributed in reducing the current account deficit of the country, the committee suggested the services sector must be “reinforced with necessary support measures”.
The standing committee suggested either replacement of the SEIS scheme or implementation of a revamped SEIS scheme to encourage the services industry to export their services and earn more foreign exchange for the country.
Sunil H Talati, chairman of SEPC in a recent interview with ET HospitalityWorld had conceded that the scrapping of SEIS benefits to services exporters had a ‘disastrous impact’ on the membership of the council. Travel, tourism and hospitality industry comprise a major segment of the SEPC membership.
“People are reluctant to renew their membership after the government discontinued the SEIS,” informs Pronab Sarkar, vice-chairman, SEPC.
Sources close to the SEPC feel that the sector would be falling short of the USD1 trillion target by 2030 unless the government comes up with a replacement for the SEIS. SEIS was one of the assurances of the last Foreign Trade Policy (2015-20). While the government extended FTP till March 31, 2023, it decided to discontinue the SEIS benefits from FY 2020.
On the new Foreign Trade Policy, which the government has kept postponing due to the volatile economic and geopolitical situation, supply chain disruptions and currency depreciation, the standing committee of the parliament expressed the hope that the government would consider announcing the new policy as normalcy is returning to the trade and industry worldwide.
