"The exim policy is not only inclined to help exports, but more specifically agri-exports."

Here is a scenario of the industries after the budget was introduced this year.

AGRICULTURE
Agriculture, the life-blood of our economy, is now again at the cross roads, as it prepares to diversify and move up the value chain. It needs to respond to second generation issues such as land degradation and water logging. Diversification, resonance with market-forces, and a swift adoption of sunrise technologies are the other needs. The major focus in this years exim policy was boost for agri-exports. It has a prominent position in the Exim Policy, mainly to provide remunerative prices for farm products. The policy removes restrictions on registration and packaging requirements on butter, wheat and wheat products, coarse grains, groundnut oil and cashew exports to Russia under the Rupee Debt Repayment Scheme. In a bid to transform select rural regions into regional rural motors of export economy, the government has sanctioned setting up 20 agri-export zones. This will lead to diversification of agriculture activity.Providing a thrust to the food-processing sector is likely to encourage the entry of corporate entities into this segment. Leading companies in the sector include Hindustan Lever, Britannia, Nestle, Amul, Tata Tea, Marico Industries and Godrej Foods.

DIVERSIFICATION INTO HORTICULTURE, FLORICULTURE, ETC.
During the current year, it is proposed to introduce a new Central Sector Scheme on Hi-tech Horticulture and Precision Farming. Major components of the scheme will be use of hi-tech interventions like fertigation, use of biotechnological tools, green food production, and hi-tech green houses. Deployment of precision farming technology aimed at judicious utilization of resources like land, water, sunlight as well as time, including demonstration of these technologies will also be part of the scheme. A sum of Rs.50 crore under this scheme is to be provided.

SUGAR AND PLANTATIONS
In order to provide relief to both the farmers and industry, the Reserve Bank of India has already issued instructions to Cooperative Banks for the conversion of shortfall in margins into medium-term working capital loans, subject of course, to their furnishing adequate security or State Government guarantees. The repayment period of medium-term loans has been extended to 9 years. In addition, the Ministry of Food and the Ministry of Finance will jointly address the problems of the sugar industry and propose a comprehensive scheme for this important agro-industry soon. The excise duty of Re 1 per kg on tea is abolished and replaced by Re 1 per kg. Coffee plantations will henceforth be eligible for income tax deduction of sums deposited in a development account, as in the case of tea. With a view to providing stability in terms of income for the small growers, from 2003-04 onwards, Government has announced a Price Stabilisation Fund of Rs.500 crore for the benefit of tea, coffee, and natural rubber growers. The Fund will become operational in 2003-04.

ANIMAL HUSBANDRY AND VETERINARY MEDICINE
To promote the health of the livestock and give a fillip to animal husbandry and dairying, it has been proposed that the basic customs duty on specified veterinary drugs would be reduced from 15 per cent to 10 per cent. To promote marine food industry the customs duty on shrimp larvae feed has been reduced from 15 per cent to 5 per cent, and has been exempted from CVD.

FERTILISER SUBSIDY
The issue price of fertilizers has been raised by a modest amount of Rs.12 for urea, and Rs.10 for DAP and MOP, per 50 kg bag. The price of complex fertilizers will also be suitably modified.

TEXTILES
Textile is the largest employment provider in the country. It also contributes substantially to our exports. The main thrust of the proposals for the textile sector, has been to have a moderate rate structure; to complete the CENVAT chain to promote compliance; to encourage modernization; and, to eliminate evasion. Keeping these objectives in view, as a package of incentives, the following measures has been proposed:

• The excise duty on polyester filament yarn has been reduced from 32 per cent to 24 per cent.
• The excise duty on all spun and other filament yarns has been reduced from 16 per cent to 12 per cent.
• The 8 per cent excise duty rate for pure cotton yarn only has been retained.
• The excise duty on all knitted cotton fabrics and garments has been reduced from 12 per cent to 8 per cent.
• The excise duty on all woven fabrics and other knitted fabrics has been reduced from 12 per cent to 10 per cent.
• The excise duty on garments has been reduced from 12 per cent to 10 per cent.
• The exemption for all knitted and unprocessed woven fabrics has been withdrawn.
• The scheme of deemed credit has been removed so as to complete the CENVAT chain.
• The exemption for hand-processed fabrics has been retained, but only if no power or steam is used in any process.
• The existing exemptions for handloom fabrics, silk, khadi and polyvastra has been continued, and
• The basic customs duty on paraxylene has been reduced from 10 per cent to 5 per cent.

PHARMACEUTICALS
All the benefits listed under health-care will also promote pharmaceutical industry. Besides, income tax concessions to pharmaceuticals, bio-technology and information technology are at par. All drugs and materials imported or produced domestically for clinical trials will have been exempted from customs and excise duties. Customs duty on import of Reference Standards by the industry has been reduced from 25 per cent to 5 per cent.

TRADE FACILITATION MEASURES
Faster clearance hereafter of cargo and fewer procedures, by reducing the transaction cost, thus facilitating exports and imports has been proposed. A number of measures have been taken to simplify and modernize the customs clearance procedures, with the main emphasis being on cutting down contact of trade with the officers, to the extent possible, and introducing computerization in customs clearances. There has been an increase in the interest-free period for warehoused goods from 30 to 90 days and reduction in the rate of interest for the period beyond 90 days to reflect the market rate of interest.

A self-assessment scheme for importers and exporters has been proposed. Under this scheme, the importer himself/herself will determine the classification of goods, including claim for any exemption benefit, and the system will calculate the duty based on his/her declaration. Physical inspection of imported goods will be done by using risk-assessment and management techniques on a computer-based system and not on the orders of customs examining staff. Further, the existing system of concurrent audit of import documents will be replaced by post-clearance audit, as prevalent in developed countries.