Source: Economic Times
Incentives in the new foreign trade policy (FTP), to be unveiled by month-end or first week of April, should focus on only three nations for boosting exports, traders body FIEO said today.
As the global economy is in a weak state, announcing incentives for a lot many countries may not help Indian exports, FIEO reasoned, adding that a sharp focus on a smaller number of markets will be more useful.
“Instead of announcing incentives for several countries, the commerce ministry should focus only on three countries – China and two oil/mineral rich African nations. Announce a big incentive package to focus only on these countries in the FTP,” Federation of Indian Export Organisations President Rafeeq Ahmed told PTI.
He said that in the current scenario when India’s exports are registering negative growth and are hovering at around $ 300 billion for the last three years, there is a need to focus on only these countries with “full force and aggression”.
“Huge opportunities exists in China for textiles, leather and handicrafts. In these three countries, exporters and government should use all the energy in terms of organising roadshows, exhibitions and fairs,” Ahmed said.
He added that a Rs 250 crore fund should be set up in the new FTP for the purpose to making made in India brand famous in these countries.
“Announcing incentives for many countries would not help us. Economic situation worldwide in not healthy. Europe, Japan and several other markets are in recession. Focusing completely on the three destinations for at least 3-4 years would help in boosting exports,” Ahmed added.
India’s exports in 2013-14 fell short of the $ 325 billion target and managed to reach $ 312.35 billion. The country’s exports stood at $ 300.4 billion in 2012-13 and $ 307 billion in 2011-12.
In the current fiscal too, the outbound shipments may reach $ 320-$ 325 billion, Ahmed said, adding that “the figures are not at all satisfactory given the size and opportunities in our country”.
The FIEO President also suggested exporters to “aggressively pursue” trade with China and compete with their products.
“The government should consider a free trade agreement with China. We shouldn’t afraid from China,” he added.
India has a trade deficit of $ 37 billion with China. FTP, which is already delayed by about an year, provides guidelines for enhancing exports with the overall objective of pushing economic growth and generating employment.
Under the policy, the government gives fiscal incentives to exporters under different promotion schemes such as the Market Access Initiative, Marketing Development Assistance, Vishesh Krishi and Gram Udyog Yojana, Focus Market Scheme, Focus Product Scheme and Market Linked Focus Products Scrip.