The Union Ministry of Commerce and Industry has lifted a six-month-old financial embargo it had placed on the Basic Chemicals and Pharmaceuticals Export Promotion Council (Chemexcil). The Ministry would soon resume granting Market Development Assistance (MDA) funds to the council. The government decision had prevented many exporters from availing MDA grants that had been sanctioned to them.

The temporary suspension of funds to the council came after an Audit Team of Department of Commerce and also a team from the Office of Comptroller and Auditor General of India unearthed a series of financial irregularities committed in Chemexcil over the last several years. According to sources, the ministry had to suspend the release of funds to Chemexcil under Market Development Assistance Scheme to ensure that no misuse of government funds is taking place.

It is known that the decision to release the funds has come after various issues affecting the council were sorted out.

Chemexcil had been going through a tough time since it was not in a position to disburse funds to any of the exporters, including exporters to LAC countries.

The ministry announcement that came on June 10th has turned out to be a major relief for the member exporters of Chemexcil whose MDA grants worth Rs 60 lakh were pending due to the embargo. The council can now approach the ministry for the release of the funds.

The suspension of grants had blocked MDA grants worth Rs 85 lakh, which should have gone to the council. The government decision has now enabled the council to go ahead with its initial market study on the export potential of anti-retroviral drugs in African markets as the Rs 70 lakh, sanctioned for the purpose, is expected to be released now. The generics market study is part of an MAI proposal sanctioned by the ministry recently.
Sources informed that the council would be able to move the requests for sanctioning of grants in a couple of months.