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Bicycle exports may come down
By agencies
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Wednesday, 04 May 2005, 19:30 IST
LUDHIANA:Terming the new duty drawback rates for bicycle and bicycle parts as a big setback, Engineering Export Promotion Council (EEPC) has projected a fall of 
2.5- 3 billion value of exports in the current financial year and has written to the government seeking a revision on the rates.
The government has fixed the duty drawback rates on export of bicycle parts with a cap of 8 per cent of Free on Board (FOB) value. Earlier, it was being given according to the unit or quantity-based rates.
The government has also not changed the rate of duty drawback on the export of bicycles, which was kept at 93 despite exporters demand of raising it to 138. The new rates will become effective from May 5.
The revised rates were announced when several exporters are in China to take part in International Bicycle Fair starting on Wednesday. "Now, exporters are in a state of confusion regarding fixing the rates of bicycle in this exhibition because of the announcement of new rates of drawback", Satish Dhanda, Chairman of Bicycle panel, EEPC, said.
He said Indian exporters would fail to secure orders from this fair as their products would be expensive when compared to Chinese bicycles.
Dhanda said with the reduction in the rates of duty drawback, bicycle exports would come down by Rs 2.5-3 billion from 7.5 billion last year. He said that it would be difficult for exporters to absorb the cost of steel, which had gone up substantially because of increase in excise duty from 12 percent to 16 percent.
2.5- 3 billion value of exports in the current financial year and has written to the government seeking a revision on the rates.
The government has fixed the duty drawback rates on export of bicycle parts with a cap of 8 per cent of Free on Board (FOB) value. Earlier, it was being given according to the unit or quantity-based rates.
The government has also not changed the rate of duty drawback on the export of bicycles, which was kept at 93 despite exporters demand of raising it to 138. The new rates will become effective from May 5.
The revised rates were announced when several exporters are in China to take part in International Bicycle Fair starting on Wednesday. "Now, exporters are in a state of confusion regarding fixing the rates of bicycle in this exhibition because of the announcement of new rates of drawback", Satish Dhanda, Chairman of Bicycle panel, EEPC, said.
He said Indian exporters would fail to secure orders from this fair as their products would be expensive when compared to Chinese bicycles.
Dhanda said with the reduction in the rates of duty drawback, bicycle exports would come down by Rs 2.5-3 billion from 7.5 billion last year. He said that it would be difficult for exporters to absorb the cost of steel, which had gone up substantially because of increase in excise duty from 12 percent to 16 percent.