In a bid to boost the exports sector, India on September 29 approved capital infusion of Rs1 ,650 Crore to the National Export Insurance Account (NEIA) scheme over a period of five years.
The decision was taken at the Union Cabinet meeting.
NEIA
NEIA Trust was established in 2006 to promote project exports from India that are of strategic and national importance. The NEIA Trust promotes Medium and Long Term (MLT) /project exports by extending (partial/full) support to covers issued by ECGC (ECGC Ltd, formerly known as Export Credit Guarantee Corporation of India Ltd.) to MLT/project export and to Exim Bank for Buyer’s Credit (BC-NEIA) tied to project exports from India.
CAPITAL INFUSION
The capital infusion in NEIA Trust is slated to help the Indian Project Exporters (IPE) to tap the huge potential of project exports in focus market. Support to project exports with Indian content sourced from across the country will enhance the manufacturing in India. Corpus contribution of Rs 1,650 Crore will enhance the underwriting capacity of the Trust and will enable NEIA to support project exports worth Rs 33,000 Crore at full capacity utilization that in turn will translate into an estimated output of domestically manufactured goods to the tune of Rs 25,000 Crore approximately, an official release said. .
In addition, assuming an average 75% Indian content in the projects, in terms of the report ‘Export to Jobs’ by World Bank and International Labour Organisation, it is estimated that around 12000 workers will move into formal sector. Further, the total workers (number of both formal and informal) will increase by 2.6 lakh in the relevant sectors as per estimates based on the report.
NEIA- PERFORMANCE HIGHLIGHTS
- The NEIA Trust was set up in 2006 to promote Medium and Long-Term (MLT)/ project exports by enabling credit and political insurance
- The corpus commitment of GOI is Rs.4000 crore and Maximum Liability Permissible is 20 times of the actual corpus
- The contribution received from the Government of India over the years, as of March 31,2021 was Rs.3,091 crore
- Since inception, NEIA has extended 213 covers, with a consolidated project value of Rs. 53,000 crores, to 52 countries as of 31st August 2021
- Its impact in enabling project exports has been most significant in Africa and South Asia.
EXPORT RELATED SCHEMES AND INITIATIVES
- Foreign Trade Policy (2015-20) extended upto 30-09-2021 due to the COVID-19 pandemic situation
- Rs 56,027 crore released in September 2021 to liquidate all pending arrears under all script base Schemes to provide liquidity in the COVID-19 times
- Roll out of a new Scheme – Remission of Duties and Taxes and Exported Products (RoDTEP). Rs 12,454 crore sanctioned for the Scheme in the FY 2021-22. It is a WTO compatible mechanism for reimbursement of taxes/ duties/ levies, which are currently not being refunded under any other mechanism, at the central, state and local level
- Support to textiles sector was increased by the remission of Central/ State taxes through the ROSCTL scheme, which has now been extended till March 2024
- Common Digital Platform for Certificate of Origin has been launched to facilitate trade and increase FTA utilization by exporters
- A comprehensive “Agriculture Export Policy” to provide an impetus to agricultural exports related to agriculture, horticulture, animal husbandry, fisheries and food processing sectors, is under implementation
- Promoting and diversifying services exports by pursuing specific action plans for the 12 Champion Services Sectors
- Promoting districts as export hubs by identifying products with export potential in each district, addressing bottlenecks for exporting these products and supporting local exporters/manufacturers to generate employment in the district
- Active role of Indian missions abroad towards promoting India’s trade, tourism, technology and investment goals has been enhanced
- Package announced in light of the covid pandemic to support domestic industry through various banking and financial sector relief measures, especially for MSMEs, which constitute a major share in exports
- Trade Infrastructure for Export Scheme (TIES), Market Access Initiatives (MAI) Scheme and Transport and Marketing Assistance (TMA) schemes to promote trade infrastructure and marketing.