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Govt working on logistics, taxation issues to boost exports’

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Government is working on addressing the key problems of exporters related with logistics cost and taxation to boost the country’s outbound shipments, Commerce Minister Nirmala Sitharaman today said.

She also said that the Ministry has started the review of the foreign trade policy (FTP) with an aim to do mid-course corrections in the export schemes if required.

Speaking at a conference on ‘Strategies for Double Digit Growth in Exports’ organised by Assocham here, the Minister said logistics is one of the “biggest issues” and it makes the cost competitiveness produced by an efficient exporter unviable, Sitharaman said.

The Minister further said that the Prime Minister too is very conscious of this fact as to “what it (logistics cost) does to our exports”.

“We have quite a few discussions on how best we can overcome these issues in the short term” but logistics are long terms issues, the Minister added.

“The priority of this government has definitely been on how to cut down on the logistics challenges whether it is road or reviving inland water ways, identifying newer waterways and improving ports is another big issue,” she said.

The Ministry is also working on making all the ports EDI (electronic data interchange) and on this both the customs and commerce ministry is working on.

“On logistics, a complete comprehensive picture is being handled,” she added.

The Commerce Ministry also had an inter-ministerial meeting to look at the issues related with railways and high freight cost “which are really mounting”.

“We are engaging with railways to cut logistics cost,” Sitharaman said.

Talking about the taxation matter, she said: “it is one of the vexing issues”.

“You cannot be paying tax over tax and also exporters cannot be taxed for exporting. We recognise that difficulty and I know that GST alone cannot give us the solution.

“Infact, GST would raise our ambition saying why can’t taxation be simplified and subsumed many of these (state) taxes into GST so that we handle only one tax. We are trying to simplify it,” she said.

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