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| Tuesday, 19 August 2003 |
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Scheme to rescue copper wire drawing plants Following the banning of copper wires made of imported chips and profiles being exported to India, due to a value addition problem, the Department of Commerce has now planned a transactional scheme to rescue existing wire drawing plants by adding further value to their products to meet the 35% domestic value addition criteria under the Indo Sri Lanka FTA. The scheme that came up under the direction of Commerce and Consumer Affairs Minister Ravi Karunanayake proposes a further step of value addition (from single stage to double stage) by manufacturing insulated copper wires and PVC coated copper wires and stranded wires and cables with a minimum of six strands. Wire drawing firms registered before April 7, 2003 will be eligible for the scheme and they also have to show 35% value addition on FOB Colombo, from the floor value of US $ 1600 per 1 Mt of copper raw materials in CIF Colombo to obtain the country of origin certificates from Sri Lanka. The government had stopped issuing country of origin certificates to copper exports to India except for those made out of imported scraps from July 7, due to serious concerns from the Indian government that the wiredrawing process in Sri Lanka does not meet the 35% value addition requirement. This situation was critical for existing wire drawing firms, where most of them are BOI registered Indian companies that came here for the sole purpose of obtaining duty free concessions under the FTA. Minister Karunanayake at a meeting with officials of the Commerce Department has expressed concern in rescuing these plants, as they employ hundreds of people most of whom are unskilled labourers. |
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