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    Aluminium body urges govt to continue with MEIS benefits, increase rate to 5%

    Aluminium body urges govt to continue with MEIS benefits, increase rate to 5%

    Aluminium body urges govt to continue with MEIS benefits, increase rate to 5%
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    By CNBC-TV18  IST (Updated)

    The Aluminium Association of India (AAI) has written to the Finance Ministry and Commerce Ministry urging that that Merchandise Exports from India Scheme (MEIS) for all aluminium products be continued with an enhanced rate of 5 percent from 2 percent at present.
    The government is planning to prune the funds marked for MEIS from around Rs 45,000 crore in FY 2019-20 to Rs 9,000 core for April-December 2020.
    The DGFT has also blocked the MEIS module from 23rd July from accepting new applications to limit the issuance of any more scrips.
    “This has created an extremely precarious situation for the Indian Aluminium exports which have declined by 11 percent from $5.7 billion in FY-19 to $5 billion in FY20, and further will render exports vulnerable and uncompetitive vis-à-vis global players in international markets,” AAI said in its letter.
    AAI has also sought inclusion of aluminium in Product Linked Incentive Scheme and implementation of Remission of Duties or Taxes on Export Products (RoDTEP) scheme on priority for aluminium industry to make India’s aluminium exports competitive and create a level playing field for Indian exporters vis-à-vis global players in international markets.
    AAI said the slump in domestic demand was hurting the domestic aluminium industry and the only option left for the industry was to export.
    “But the prices are expected to continue to be weak due to demand slump globally. Aluminium exports from India are struggling to remain globally competitive due to high incidence of unrebated Central and State taxes and duties, constituting around 15 percent of aluminium production cost which is amongst the highest in the world,” the AAI letter said.
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