Foreign Trade Policy should target 30% gwth in exports: CII

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India should target an atleast 30 percent growth in exports for the next three years, according to the Confederation of Indian Industry (CII).

 

The Annual Foreign Trade Policy Supplement 2007-08, to be announced by the Union Commerce and Industry Minister, Mr. Kamal Nath in the first week of April 2007 needs to focus on further simplifying the procedures for exports and imports to facilitate higher growth rates for export. The average growth rate of exports for the past 5 years is 24 percent.

 

The Government should continue simplifying export and import procedures for small and medium sector units, which contribute a large amount to the total exports from the country, according to Mr. Sanjay Budhia, Chairman, CII Trade Policy Committee.

 

Another important aspect on Trade Facilitation for India is setting a target of a maximum of 10 hours turnaround time at ports for all goods by 2010.

  

Agricultural exports contribute not more than 11 percent to the total India's export basket, which needs to improve given the large potential in global markets. The Foreign Trade Policy needs to focus more on agricultural products, according to CII.

 

Poor roads linkages with ports are the major area of concern. There is need for better linkages with ports, it takes about 16 days for a shipment to reach a port from a cluster in north India. This is almost the time taken for a shipment to reach Europe from Indian ports, according to Mr. Budhia.

 

Use of communication services and information technology to monitor trade flows should receive priority in the Annual Foreign Trade Policy Supplement. This will help exporters in supply chain management, which is important for good growth in exports.

 

The Government should ensure stability in policies with no mid-year or sudden changes to enable long term planning for exports and focus more on labor-intensive sectors like textiles, handicrafts, leathers etc.

 

In the suggestions submitted for the Annual Foreign Trade Policy Supplement 2007-08 to Mr. Kamal Nath, CII has asked for continuation of the Duty Entitlement Pass Book (DEPB) scheme till 2009.

 

An important problem that the Foreign Trade Policy needs to focus on is that exporters are not exempted from Central Sales Tax, Fringe Benefit Tax, Service Tax and Octroi, which makes Indian exports uncompetitive in the global market, said Mr. Budhia.  The Policy needs to bring a mechanism for exempting these taxes.

 

A number of export containers of steel and casting have been detained and returned to india from various us ports even though these containers were scanned and given clearance certificates at the trans-shipment points by the us custom officials.

 

Mr. Sanjay Budhia urge the Government to take necessary steps and sensitize the US Customs Authorities about this problem and take suitable remedial measures quickly.

 

Exports for financial year 2006-07 (April - January) is US$ 99.13 billion. CII feels that the current trends of exports will touch US$ 130 billion mark in the financial year 2006-07 and US$ 150 billion by 2009, said Mr. Sanjay Budhia.

 

Sourced From: Confederation of Indian Industry