The Incremental Exports Incentivisation Scheme (IEIS) for Indian cotton yarn exporters has been temporarily restored. Under the IEIS, exporters earn credit amounting to 2 percent of the duty on annualized increases in exports over qualifying periods and for particular markets. They may either use this credit to import industry-related goods for themselves or sell the credit to another yarn manufacturer. The central government decided to withdraw the incentive in September last year, a decision that affected cotton yarn prices in the local market. India's Directorate General of Foreign Trade has now restored the benefit for the period until March 31, 2014. Considering the little time remaining, the move is not expected to have a major impact on Indian cotton yarn prices but it should help exporters cut losses or improve profits.

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