Textile minister Kasiram Rana told reporters that the allocation under the NIE system stepped up from 10 to 15 per cent of the annual level had been linked to investment with the technology upgradation fund scheme (TUFS) and introducing the actual user condition and making the quota non-transferable. The objective was to prevent misuse of the system, he added.

Rana said that the NQE system for garments and knitwears had however been continued in the new policy that would be effective from January 1 in order to avoid fragmentation of quotas.

The new policy aimed at simplification and uniformity of procedures, better and periodic utilisation, time-bound action in case of appeals and evengreater transparency, Rana stated.

It also sought to ensure continuity and stability and at the same time making exporters more competitive in order to enable them to face the challenges of the post-quota regime starting from January 2005.

Rana said the annual levels of past performance entitlement (PPE) system had almost been kept at the level of 55 per cent of the annual allocation for all the textile export items in the policy.

The minister said there had been an increase of five per cent in the allocation of quotas for export of fabrics under the powerloom exporters entitlement (PEE) system and the manufacturers exporters entitlement (MEE) system.

The allocation under the ready goods entitlement (RGE) system had also been upped by five per cent for exports of yarn, fabrics made-ups (handlooms) under quantitative restraint in the US.

The minister said that the policy had retained the high value entitlement for apparels, while it had been abolished in the case of fabrics, yarn and made-ups. Thetime-limit for utilising the RGE quota had been increased. In the case of India items,there would be no need of certification of shipping by Director-General, Apparel Export Promotion Council. In the new policy, determination as well as allocation of quotas would be made by the Quota Administration Authority, instead of the textile commissioner.

Rana said the policy had introduced the concept of periodic phased utilisation. The allotments under various systems would be made in two parts. The first part would have to be utilised by May 31 with a relaxation that shipments could be effected by June 20. Un-utilised quotas by this date would lapse.

Asked if the quota entitlement increase for new investors was a mere 15 per cent, textile secretary Shyamal Ghosh said if the response was good it could be revised upwards in the coming years.

The significant aspect of the policy is that it has retained high value entitlement for apparels to check the downward trend in unit value realisation.