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Remittances to get duty-free import facility
Sidhartha in New Delhi |
April 02, 2003 13:58 IST
The government will permit all Indians making remittances to the country to avail of the duty-free import facility for service sectors announced by Commerce and Industry Minister Arun Jaitley as part of the amendments to the Exim Policy for 2003-04 on Monday.
The directorate-general of foreign trade will, however, issue a list barring the import of certain products.
This will be in addition to the negative list of services that will not be entitled to receive the duty-free import benefits.
The services that are expected to be put on the list include legal and architectural services, space transport and wholesale trade.
Commerce ministry officials said the revenue department had agreed to the proposal on remittances and the facility would not involve any major tax outgo.
This will mean any Indian returning from a business trip can now buy the elusive laptop computer on which he had to pay over 100 per cent Customs duty.
Remittances cannot strictly be classified as service exports, but it is difficult to separate the origins of such fund flows.
The government recently relaxed the rules for repatriating foreign exchange to the country as well as the norms for opening dollar-denominated accounts by non-resident Indians in the country.
The government has also permitted resident Indians to open dollar accounts to park their funds earned abroad.
In the Exim Policy, the government has permitted duty-free imports for service sector companies with minimum foreign exchange earnings of Rs 10 lakh (Rs 1 million) a year.
The duty-free entitlement has been set at 10 per cent for most sectors except hotels where the limit is 5 per cent.
Minister of state for commerce and industry Rajiv Pratap Rudy told Business Standard the government was planning to make available funds to the service sectors from schemes like the market access initiative.
"They can undertake studies and organise trips to foreign countries to study the market potential," he said.
The minister also said the funding of the entertainment sector through venture capital funds would not only boost Indian exports but would also clean up the sector and bring about professionalism.
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