Press Information Bureau

Government of India

Ministry of Commerce & Industry

26-July-2011 17:22 IST

Anand Sharma Restores DEPB Benefits for Cotton and Cotton Yarn

The Union Minister of Commerce, Industry and Textiles Shri Anand Sharma has restored the DEPB benefits for cotton yarn from 1st April, 2011 and on Cotton from 1st October, 2010. The Minister said here today, “I have taken a composite review of the cotton and cotton yarn industry over the last few days. Both of these segments have faced huge fluctuation in the international and domestic prices.”

Explaining further, Shri Sharma said “the policy of the Government has been calibrated over the last one year and cotton yarn has been placed on OGL for exports w.e.f. 1st April 2011. Therefore, I have taken a conscious decision to restore the DEPB benefits for cotton yarn w.e.f. 1st April 2011.”

On the issue of DEPB benefits for cotton, Shri Sharma said “in the last cotton year, cotton exports were dis-incentivised by virtue of export tax which was in place, which has since been dismantled w.e.f. 1st October 2010. Clearly, the policy intention of the Government was not to dis-incentivise exports after that cut-off date and I have now taken a view to restore DEPB benefit on cotton w.e.f. 1st October 2010.”

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DS

DEPB benefit restoration for cotton and cotton yarn reinstates export incentives after policy recalibration and tax removal. Restoration of DEPB benefits reinstates export incentives for cotton yarn effective 1 April 2011 and for cotton effective 1 October 2010, in response to international and domestic price volatility and a policy recalibration; the announcement notes cotton yarn's placement on OGL and the dismantling of an export tax that had previously disincentivised cotton exports, thereby aligning incentive treatment with the Government's intended export policy.