Exim Policy 2002-07

1. The EXIM Policy for 2002-07 which came in effect on 1st April, 2002 was the first policy which had to be formulated keeping in view all the commitments India had made under the WTO. In 2001, all quantitative restrictions on imports were removed.2. SEZ:Offshore Banking Units (OBUs) were permitted in SEZs. Detailed guidelines were worked out by RBI to help some of our cities emerge as financial nerve centers of Asia. Units in SEZ were permitted to undertake hedging of commodity price risks, provided such transactions were undertaken by the units on stand-alone basis. This would impart security to the returns of the unit. It had also been decided to permit External Commercial Borrowings (ECBs) for tenure of less than three years in SEZs. The detailed guidelines would be worked out by RBI. This would provide opportunities for accessing working capital loan for these units at internationally competitive rates.3.AgricultureExport restrictions like registration and packaging requirement were removed on Butter, Wheat and Wheat products, Coarse Grains, Groundnut Oil and Cashew to Russia. Quantitative and packaging restrictions on wheat and its products, Butter, Pulses, grain and flour of Barley, Maize, Bajra, Ragi and Jowar had already been removed on 5th March, 2002.Restrictions on export of all cultivated (other than wild) varieties of seed, except Jute and Onion, removed. To promote export of agro and agro based products, 20 Agri export zones had been notified. In order to promote diversification of agriculture, transport subsidy was to be available for export of fruits, vegetables, floriculture, poultry and dairy products. The details was worked out in three months. 3% special DEPB rate for primary & processed foods exported in retail packaging of 1 kg or less.4. Cottage and Handicraft :An amount of Rs. 5 crore under Market Access Initiative (MAI) had been earmarked for promoting cottage sector exports coming under the KVIC. The units in the handicrafts sector can also access funds from MAI scheme for

development of website for virtual exhibition of their product. Under the Export Promotion Capital Goods (EPCG) scheme, these units would not be required to maintain average level of exports, while calculating the Export Obligation. These units were entitled to the benefit of Export House status on achieving lower average export performance of Rs. 5 crore as against Rs. 15 crore for others. The units in handicraft sector were entitled to duty free imports of an enlarged list of items as embellishments up to 3% of FOB value of their exports.5. Towns of Export Excellence:With a view to encouraging further development of centers of economic and export excellence such as Tirupur for hosiery, woolen blanket in Panipat, woollen knitwear in Ludhiana. Common service providers in these areas ware entitled for facility of EPCG scheme. The recognized associations of units in these areas would be able to access the funds under the Market Access Initiative scheme for creating focused technological services and marketing abroad. Such areas would receive priority for assistance for identified critical infrastructure gaps from the scheme on Central Assistance to States. Entitlement for Export House status at Rs. 5 crore instead of Rs. 15 crore for others.6. Leather Exports: Duty free imports of trimmings and embellishments upto 3% of the FOB value hitherto confined to leather garments extended to all leather products.7. Textiles: Sample fabrics permitted duty free within the 3% limit for trimmings and embellishments. 10% variation in GSM was allowed for fabrics under Advance Licence. Additional items such as zip fasteners, inlay cards, eyelets, rivets, eyes, toggles, velcro tape, cord and cord stopper included in input output norms. Duty Entitlement Passbook (DEPB) rates for all kinds of blended fabrics permitted. Such blended fabrics to have the lowest rate as applicable to different constituent fabrics.8. Gem & Jewelry: Customs duty on import of rough diamonds was reduced to 0%. Import of rough diamonds is already freely allowed. Licensing regime for rough diamond was abolished. This was done to help the country emerge as a major international centre for diamonds. Value addition norms for

export of plain Jewelry reduced from 10% to 7%. Export of all mechanized unstudded Jewelry allowed at a value addition of 3 % only. Having already achieved leadership position in diamonds, now efforts were to be made for achieving quantum jump on Jewelry exports as well. Personal carriage of Jewelry allowed through Hyderabad and Jaipur airport as well.9. Electronic Hardware: The Electronic Hardware Technology Park (EHTP) scheme was modified to enable the sector to face the zero duty regime under ITA(Information Technology Agreement)-1. Net Foreign Exchange as a Percentage of Exports (NFEP) positive in 5 years. No other export obligation for units in EHTP. Supplies of ITA I items having zero duty in the domestic market to be eligible for counting of export obligation.10. Chemicals: All pesticides formulations to have 65% of DEPB rate of such pesticides. Free export of samples without any limit. Reimbursement of 50% of registration fees for registration of drugs.11. Project Exports: Free import of equipment and other goods used abroad for more than one year.12. Facilities to Status Holders: The status holders were eligible for the License/Certificate/Permissions and Customs clearances for both imports and exports on self-declaration basis. Fixation of Input-Output norms on priority; Priority Finance for medium and long term capital requirement as per conditions notified by RBI; Exemption from compulsory negotiation of documents through banks. The remittance, however, would continue to be received through banking channels; 100% retention of foreign exchange in Exchange Earners’ Foreign Currency (EEFC) account; Enhancement in normal repatriation period from 180 days to 360 days.13. Neutralizing high fuel costs: Fuel costs to be rebated by it in Standard Input Output Norms (SIONs) for all export products. This would enhance the cost competitiveness of our export products.14. Setting up of "Business Centre" in Indian missions abroad for visiting Indian exporters/businessmen.15. ITPO portal to host a permanent virtual exhibition of Indian export product.16. Focus LAC (Latin American Countries) was launched in November, 1997

in order to accelerate our trade with Latin American countries. This had been a great success. Focus Africa was proposed to be launched . The first phase of the Focus Africa programme was to include 7 countries namely, Nigeria, South Africa, Mauritius , Kenya, Ethiopia, Tanzania and Ghana. The exporters exporting to these markets were given Export House Status on export of Rs. 5 crore.17. Links with CIS countries to be revived. We have traditional trade ties with these countries. In the year 2000-01, our exports to these countries were to the extent of US$ 1082 million. In this group, Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan, Ukraine and Azerbaijan were to be in special focus in the first phase.18. North Eastern States, Sikkim and Jammu & Kashmir: Transport subsidy for exports to be given to units located in North East, Sikkim and Jammu & Kashmir so as to offset the disadvantage of being far from ports.19. Re-location of industries: To encourage re-location of industries to India, plant and machineries would be permitted to be imported without a license, where the depreciated value of such relocating plants exceeds Rs. 50 crores.20. A new 8 digit commodity classification for imports was adopted from 1st April 2002. This classification would also be adopted by Customs and DGCI&S shortly. The common classification to be used by DGFT and Customs would eliminate the classification disputes and hence reduce transaction costs and time. Similarly, Ministry of Environment and Forests is in the process of finalization of guidelines to regulate the import of hazardous waste.21. Reduction of the maximum fee limit for electronic application under various schemes from Rs. 1.5 lakh to Rs. 1.00 lakh. Same day licensing introduced in all regional offices.22. Customs: Adoption and harmonization of the 8 digit ITC(HS) code. The percentage of physical examination of export cargo had already been reduced to less than 10 percent except for few sensitive destinations. The application for fixation of brand rate of drawback was finalized within 15 days.

23. Banking: Direct negotiation of export documents to be permitted. This would help the exporters to save bank charges. 100% retention in EEFC accounts. The repatriation period for realization of export proceeds extended from 180 days to 360 days. The facility is already available to units in SEZ and exporters exporting to Latin American countries. (however these facilities were made available to status holders at that time)24. Import/Export of samples to be liberalized for encouraging product up gradation.25. Penal interest rate for bonafide defaults to be brought down from 24% to 15%.26. No penalty for non-realization of export proceeds in respect of cases covered by ECGC insurance package.27. No seizure of stock in trade so as to disrupt the manufacturing process affecting delivery schedule of exporters.28. Foreign Inward Remittance Certificate (FIRC) to be accepted in lieu of Bank Realization Certificate for documents negotiated directly.29. Optional facility to convert from one scheme to another scheme. In case the exporter is denied the benefit under one scheme, he was entitled to claim benefit under some other scheme.30. Newcomers to be entitled for licenses without any verification against execution of Bank Guarantee.31. Duty Exemption Entitlement Certificate (DEEC) book was abolished. Redemption on the basis of Shipping bills and Bank Realization Certificates.32. Withdrawal of Advance License for Annual Requirement (AAL) scheme as problems were encountered in closure of AAL and the significance of scheme considerably reduced due to dispensation of DEEC. The exporters can avail Advance License for any value. Mandatory spares to be allowed in the Advance License up to 10% of the CIF value.33. Duty Entitlement Passbook (DEPB) : Value cap exemption granted on 429 items to continue, No Present Market Value (PMV) verification except on specific intelligence, Same DEPB rate for exports whether as CBUs or in CKD/SKD form, Reduction in rates only after due notice. DEPB for transport vehicles to Nepal in free foreign exchange. DEPB rates for composite items

to had lowest rate applicable for such constituent.34. Export Promotion Capital Goods (EPCG) : EPCG licenses of Rs. 100 crore or more to had 12 year export obligation period with 5 year moratorium period. Export Obligation fulfillment period extended from 8 years to 12 years in respect of units in agri-export zones and in respect of companies under the revival plan of BIFR. Supplies under Deemed Exports to be eligible for export obligation fulfillment along with deemed export benefit. Re-fixation of EO in respect of past cases of imports of second hand capital goods under EPCG Scheme.

8888888888888888888888888888888888888888888888888888888888888888

Foreign Trade Policy 2004-09

1. The new Foreign Trade Policy of the Union Government was unveiled by the commerce Minister Shri. Kamal Nath on August 31, 2004. With foreign trade largely freed and import duties falling progressively, the policy have necessarily restricted itself to a facilitating role rather. This policy stated, “Trade is not an end in itself , but a means to economic growth.

2.Objectives:2.1. To double India’s percentage share of global merchandise trade by 2009.

India had a share of 0.8% in Foreign Trade between 2003-2004, the target in this policy was set to achieve 1.5% share in world trade by 2009. It was 1.1% in 2005 & 1.2% in 2006 and in May 2007 it had touched 1.5%.

2.2. To act as an effective instrument of economic growth by giving a thrust to employment generation, especially in semi-urban and rural areas.3. The key strategies:3.1. Unshackling of controls and creating an atmosphere of trust and transparency

3.2. Simplifying procedures and bringing down transaction costs3.3. Neutralizing incidence of all levies on inputs used in export products and adopting the fundamental principle that duties and levies should not be exported.3.4. Identifying and nurturing different special focus areas to facilitate development of India as a global hub for manufacturing, trading and services.3.5. Facilitating technological and infrastructural up gradation of the Indian Economy. Especially through import of capital goods and equipment.3.6. Avoiding inverted duty structure and ensuring that domestic sectors are not harmed.3.7. Revitalizing Board of trade.3.8. Activating Indian Embassies as key players in the export strategy of our country.4. Special Focus Initiatives:4.1. Sectors with significant export prospects coupled with potential for employment generation in semi-urban and rural areas have been identified as thrust sectors, and specific sectoral strategies have been prepared.4.2. Further sectoral initiatives in other sectors will be announced from time to time. For the present, Special Focus Initiatives have been prepared for Agriculture, Handicrafts, Handlooms, Gems & Jewelry and Leather & Footwear sectors.4.3. The threshold limit of designated ‘Towns of Export Excellence’ is reduced from Rs. 1000 crores to Rs. 250 crores in these thrust sectors.5. Agriculture5.1. A new scheme called Vishesh Krishi Upaj Yojana has been introduced to boost exports of fruits, vegetables, flowers, minor forest produce and their value added products.5.2. Capital goods imported under EPCG for agriculture permitted to be installed anywhere in the Agri Export Zone.5.3. ASIDE funds to be utilized for development for Agri Export Zones also.5.4. Import of seeds, bulbs, tubers and planting material has been liberalized.

5.5. Export of plant portions, derivatives and extracts has been liberalized with a view to promote export of medicinal plants and herbal products.6. Gems & Jewelry6.1. Duty free import of consumables for metals other than gold and platinum allowed up to 2% of FOB value of exports.6.2. Duty free re-import entitlement for rejected jewelry allowed up to 2% of FOB value of exports.6.3. Duty free import of commercial samples of jewelry increased to Rs. 1 lakh.6.4. Import of gold of 18 carat and above shall be allowed under the replenishment scheme.7. Handlooms & Handicrafts7.1. Duty free import of trimmings and embellishments for Handlooms & Handicrafts sectors increased to 5% of FOB value of exports.7.2. Import of trimmings and embellishments and samples shall be exempt from CVD.7.3. Handicraft Export Promotion Council authorized to import trimmings, embellishments and samples for small manufacturers.7.4. A new Handicraft Special Economic Zone shall be established.8. Leather & Footwear8.1. Duty free entitlements of import trimmings, embellishments and footwear components for leather industry increased to 3% of FOB value of exports.8.2. Duty free import of specified items for leather sector increased to 5% of FOB value of exports.8.3. Machinery and equipment for Effluent Treatment Plants for leather industry shall be exempt from Customs Duty.9. Export Promotion Schemes9.1. Target Plus: A new scheme to accelerate growth of exports called ‘Target Plus’ has been introduced. Exporters who have achieved a quantum growth in exports would be entitled to duty free credit based on incremental exports substantially higher than the general actual export target fixed. (Since the target fixed for 2004-05 is 16%, the lower limit of performance for

qualifying for rewards is pegged at 20% for the current year).9.2. Rewards will be granted based on a tiered approach. For incremental growth of over 20%, 25% and 100%, the duty free credits would be 5%, 10% and 15% of FOB value of incremental exports.9.3. Vishesh Krishi Upaj Yojana:9.4. Another new scheme called Vishesh Krishi Upaj Yojana (Special Agricultural Produce Scheme) has been introduced to boost exports of fruits, vegetables, flowers, minor forest produce and their value added products. Export of these products shall qualify for duty free credit entitlement equivalent to 5% of FOB value of exports. The entitlement is freely transferable and can be used for import of a variety of inputs and goods.9.5. Served from India Scheme: To accelerate growth in export of services so as to create a powerful and unique ‘Served from India’ brand instantly recognized and respected the world over, the earlier DFEC scheme for services has been revamped and re-cast into the ‘Served from India’ scheme. Individual service providers who earn foreign exchange of at least Rs. 5 lakh, and other service providers who earn foreign exchange of at least Rs. 10 lakh will be eligible for a duty credit entitlement of 10% of total foreign exchange earned by them. In the case of stand-alone restaurants, the entitlement shall be 20%, whereas in the case of hotels, it shall be 5%. Hotels and Restaurants can use their duty credit entitlement for import of food items and alcoholic beverages.9.6. EPCG: Additional flexibility for fulfillment of export obligation under EPCG scheme in order to reduce difficulties of exporters of goods and services. Technological up gradation under EPCG scheme has been facilitated and incentivized. Transfer of capital goods to group companies and managed hotels now permitted under EPCG. In case of movable capital goods in the service sector, the requirement of installation certificate from Central Excise has been done away with. Export obligation for specified projects shall be calculated based on concessional duty permitted to them. This would improve the viability of such projects.9.7. DFRC: Import of fuel under DFRC entitlement shall be allowed to be transferred to marketing agencies authorized by the Ministry of Petroleum

and Natural Gas.9.8. DEPB: The DEPB scheme would be continued until replaced by a new scheme to be drawn up in consultation with exporters.9.9. New Status Holder Categorization: A new rationalized scheme of categorization of status holders as Star Export Houses has been introduced as under:Category Total performance over three years(1) One Star Export House: 15 crores(2) Two Star Export House: 100 crores(3) Three Star Export House: 500 crores(4) Four Star Export House: 1500 crores(5) Five Star Export House: 5000 croresStar Export Houses shall be eligible for a number of privileges including fast-track clearance procedures, exemption from furnishing of Bank Guarantee, eligibility for consideration under Target plus Scheme etc.10. Export Oriented Units10.1.EOUs shall be exempted from Service Tax in proportion to their exported goods and services.10.2.EOUs shall be permitted to retain 100% of export earnings in EEFC accounts10.3.Income Tax benefits on plant and machinery shall be extended to DTA units which convert to EOUs.10.4.Import of capital goods shall be on self-certification basis for EOUs.10.5.For EOUs engaged in Textile & Garments manufacture leftover materials and fabrics upto 2% of CIF value or quantity of import shall be allowed to be disposed of on payment of duty on transaction value only.10.6.Minimum investment criteria shall not apply to Brass Hardware and Hand-made Jewelry EOUs (this facility already exists for Handicrafts, Agriculture, Floriculture, Aquaculture, Animal Husbandry, IT and Services).

11. FTWZ Free Trade & Warehousing ZoneA new scheme to establish Free Trade and Warehousing Zone has been introduced to create trade-related infrastructure to facilitate the import and

export of goods and services with freedom to carry out trade transactions in free currency. This is aimed at making India into a global trading-hub.FDI would be permitted up to 100% in the development and establishment of the zones and their infrastructural facilities. Each zone would have minimum outlay of Rs. 100 crores and five lakh sq. mts. built up area. Units in the FTWZs would qualify for all other benefits as applicable for SEZ units.12. Import of Second Hand Capital Goods12.1.Import of second-hand capital goods shall be permitted without any age restrictions.12.2.Minimum depreciated value for plant and machinery to be re-located into India has been reduced from Rs. 50 crores to Rs. 25 crores.13. Services Export Promotion Council:An exclusive Services Export Promotion Council shall be set up in order to map opportunities for key services in key markets, and develop strategic market access programmes, including brand building, in co-ordination with sectoral players and recognized nodal bodies of the services industry.14. Common Facilities Centre:Government shall promote the establishment of Common Facility Centers for use by home-based service providers, particularly in areas like Engineering & Architectural design, Multi-media operations, software developers etc., in State and District-level towns, to draw in a vast multitude of home-based professionals into the services export arena.15. Procedural Simplification & Rationalization Measures15.1.All exporters with minimum turnover of Rs. 5 crores and good track record shall be exempt from furnishing Bank Guarantee in any of the schemes, so as to reduce their transactional costs.15.2.All goods and services exported, including those from DTA units, shall be exempt from Service Tax.15.3.Validity of all licenses/entitlements issued under various schemes has been increased to a uniform 24 months.15.4.Number of returns and forms to be filed have been reduced. This process shall be continued in consultation with Customs & Excise.15.5.Enhanced delegation of powers to Zonal and Regional offices of DGFT

for speedy and less cumbersome disposal of matters.15.6.Time bound introduction of Electronic Data Interface (EDI) for export transactions.15.7.75% of all export transactions to be on EDI within six months.16. Pragati Maidan: In order to showcase our industrial and trade prowess to its best advantage and leverage existing facilities, Pragati Maidan will be transformed into a world-class complex. There shall be state-of-the-art, environmentally-controlled, visitor friendly exhibition areas and marts. A huge Convention Centre to accommodate 10,000 delegates with flexible hall spaces, auditoria and meeting rooms with high-tech equipment, as well as multi-level car parking for 9,000 vehicles will be developed within the envelope of Pragati Maidan.17. Legal Aid: Financial assistance would be provided to deserving exporters, on the recommendation of Export Promotion Councils, for meeting the costs of legal expenses connected with trade-related matters.18. Grievance Redressal: A new mechanism for grievance redressal has been formulated and put into place by a Government Resolution to facilitate speedy redressal of grievances of trade and industry.19. Quality Policy:19.1.DGFT shall be a business-driven, transparent, corporate oriented organization.19.2.Exporters can file digitally signed applications and use Electronic Fund Transfer Mechanism for paying application fees.19.3.All DGFT offices shall be connected via a central server making application processing faster. DGFT HQ has obtained ISO 9000 certification by standardizing and automating procedures.20. Bio Technology Parks : Biotechnology Parks to be set up which would be granted all facilities of 100% EOUs.21. Co-acceptance/ Validation introduced as equivalent to irrevocable letter of credit to provide wider flexibility in financial instrument for export transaction22. Board of Trade: The Board of Trade shall be revamped and given a clear and dynamic role. An eminent person or expert on trade policy shall be

nominated as President of the Board of Trade, which shall have a Secretariat and separate Budget Head, and will be serviced by the Department of Commerce.with inputs from DGFT Foreign Trade Policy 2004-09

8888888888888888888888888888888888888888888888888888888888888888888

Finance Bill 2011 Highlights

In the Union Budget 2011-12, Finance Minister Pranab Mukherjee today announced higher tax exemption limit of Rs 1.8 lakh for individuals and further benefits to senior citizens, additional services into the tax net and withdrawal of duty exemption on some items.

Other major proposals included bank licenses to new private sector players, speeding up of various financial sector reform bills and a disinvestment target of Rs 40,000 crore for the next fiscal.

Here are some of the major announcements :

* Tax exemption limit raised to Rs 1.80 lakh, from Rs 1.60 lakh, for general category individual tax papers.

* For senior citizens, the qualifying age reduced to 60 years; tax exemption limit raised to Rs 2.50 lakh.

* Over 80-year old senior citizens to get Rs 5 lakh exemption limit.

* Tax surcharge for companies cut to 5 per cent, from 7.5 per cent.

* Deduction of Rs 20,000 from taxable income for investment in long-term infra bonds extended till next fiscal.

* A simpler I-T return form 'Sugam' for small tax papers.

* Housing loan limit raised from Rs 20 lakh to Rs 25 lakh from priority sector lending; 1 per cent interest rate subsidy for home loans up to Rs 15 lakh.

* Service tax, peak customer duty rates retained at 10 per cent; duty exemptions to be withdrawn on various items.

* Total expenditure estimated at Rs 12, 57,729 crore forthe current fiscal; gross tax receipts at over Rs 9.3 lakh crore.

* Fiscal deficit target at 4.6 per cent for 2011-12, down from 5.1 per cent estimated for current fiscal.

* Disinvestment target for the next fiscal at Rs 40,000 crore. Proceeds for the current fiscal at 22,144 crore.

* RBI final guidelines for issuing new bank licenses to private players by March-end; Bill for amendments this session.

* Financial sector reforms to move forward.

* Bills on Insurance amendment, LIC and Pension Development Authority, Banking Laws amendment, SBI subsidiaries and BIFR in the current session.

* Financial Sector Legislative Reforms Commission, to be headed by former Supreme Court judge B Srikrishna, to complete its work in 24 months; to overhaul financial regulations.

In the Union Budget 2011-12, Finance Minister Pranab Mukherjee today announced higher tax exemption

limit of Rs 1.8 lakh for individuals and further benefits to senior citizens, additional services into the tax net

and withdrawal of duty exemption on some items.

Other major proposals included bank licenses to new private sector players, speeding up of various financial

sector reform bills and a disinvestment target of Rs 40,000 crore for the next fiscal.

In the Union Budget 2011-12, Finance Minister Pranab Mukherjee today announced higher tax exemption

limit of Rs 1.8 lakh for individuals and further benefits to senior citizens, additional services into the tax net

and withdrawal of duty exemption on some items.

Other major proposals included bank licenses to new private sector players, speeding up of various financial

sector reform bills and a disinvestment target of Rs 40,000 crore for the next fiscal.

Here are some of the major announcements :

* Tax exemption limit raised to Rs 1.80 lakh, from Rs 1.60 lakh, for general category individual tax papers.

* For senior citizens, the qualifying age reduced to 60 years; tax exemption limit raised to Rs 2.50 lakh.

* Over 80-year old senior citizens to get Rs 5 lakh exemption limit.

* Tax surcharge for companies cut to 5 per cent, from 7.5 per cent.

* Deduction of Rs 20,000 from taxable income for investment in long-term infra bonds extended till next

fiscal.

* A simpler I-T return form 'Sugam' for small tax papers.

* Housing loan limit raised from Rs 20 lakh to Rs 25 lakh from priority sector lending; 1 per cent interest rate

subsidy for home loans up to Rs 15 lakh.

* Service tax, peak customer duty rates retained at 10 per cent; duty exemptions to be withdrawn on various

items.

* Total expenditure estimated at Rs 12, 57,729 crore forthe current fiscal; gross tax receipts at over Rs 9.3 lakh

crore.

* Fiscal deficit target at 4.6 per cent for 2011-12, down from 5.1 per cent estimated for current fiscal.

* Disinvestment target for the next fiscal at Rs 40,000 crore. Proceeds for the current fiscal at 22,144 crore.

* RBI final guidelines for issuing new bank licenses to private players by March-end; Bill for amendments this

session.

* Financial sector reforms to move forward.

* Bills on Insurance amendment, LIC and Pension Development Authority, Banking Laws amendment, SBI

subsidiaries and BIFR in the current session.

New Companies Bill to be introduced in current session.

* Discussions on to further liberalize FDI policy.

* Govt to move towards direct transfer of cash subsidy for kerosene, LPG and fertilizers.

* Constitution Amendment Bill for introduction of GST regime in this session.

* Direct Tax Code Bill likely to be passed by Parliament next financial year.

* Foreign investors to be allowed to directly invest in MFs; Investment limit for FIIs in corporate bonds to go

up.

* A new scheme to be introduced for refund of service tax on lines of drawback of duties.

* A self-assessment of customs duty to be introduced for importers and exporters to enable them to assess duty

payment.

* Remuneration of anganwadi workers raised from Rs 1,500 to Rs 3,000 a month. Helpers to get Rs 1,500

from Rs 750.

* Old age pension to persons over 80 years raised from Rs 200 to Rs 500.

* Compensation of Rs 9 lakh to be given to defence and Central paramilitary forces for permanent disability

and discharge from service.

* Net loss from direct tax proposals at Rs 11,500 crore.

* Excise, customs duty proposals to provide net gain of Rs 7,300 crore; revenue gain of Rs 4,000 crore from

service tax.

* Net revenue loss on account of taxes and duties will be Rs 200 crore for the year.

* Standard rate of central exercise duty maintained at 10 per cent; no change in CENVAT rates.

* Nominal 1 per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious

stones, gold and silver jewellery will be exempted.

* Basic customs duty on agricultural machinery reduced to 4.5 per cent from 5 per cent.

* Service tax net widened to cover hotel accommodation above Rs 1,000 per day, A/C restaurants serving

liquor, some category of hospitals, diagnostic tests.

* Service tax on air travel up to Rs 50 for domestic travel and Rs 250 for international travel in economy

class;on higher classes, it will be 10 per cent flat.

* Some legal services to be brought under service tax net; service by individual to another individual

exempted.

* Services provided by life insurance companies in the area of investment are also proposed to be brought into

tax net, on the same lines as ULIPs.

* Government to put in place framework for safeguard of small borrowers in microfinance sector.

* Corruption, inflation and current account deficits identified as major areas of concern.

* PSU banks to get Rs 6,000 crore for maintaining capital-to-risk asset ratio norms.

* To give Rs 300 crore for promoting pulses cultivation in rain-fed areas; another Rs 300 crore to promote

farm product cultivation.

* Credit flows to farmers raised from Rs 3.75 lakh crore to Rs 4.75 lakh crore.

* Existing interest subvention scheme on short term farm loans at 7 per cent interest to continue.

* Public Debt Management Agency Bill in the next fiscal.

* A bill to be introduced to amend Indian Stamps Act.

* Financial Sector Legislative Reforms Commission, to be headed by former Supreme Court judge B

Srikrishna, to complete its work in 24 months; to overhaul financial regulations.