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Policy framework a must to address export finance issues: Commerce secretary Rita Teaotia

Addressing an industry event organised by trade lobby Assocham,’ Commerce Secretary Rita Teaotia said, banks and financial institutions need to become more sensitive towards small units, which contribute 30 per cent of exports in terms of value. 

To become a $5-trillion economy, we need 40 per cent trade contribution and exports of at least $1 trillion. To achieve this, we must actually gear up our policy framework and address the precise needs of export finance and institutions serving exporters," commerce secretary Rita Teaotia said. 

"We need to actually gear up not just the regulatory frameworks to address the precise needs of export finance and institutions serving export markets but also look at the costs of being able to serve smaller organisations using technology, using better tools in order to bring down the costs of actually extending credit to MSME sector," she said.

"There is a very large challenge for SME sector, which is actually a very large number of our exporters. The availability of finance and export finance is even more constrained; this is something which affects the competitiveness of India’s exports and unless we address this challenge we are not going to be able to become a significant global player," said Ms Teaotia.

She stressed that new issues like e-commerce, SME, gender, investment at the World Trade Organization are important issues; she wonders why India has been opposing discussions on them. “ We recognise e-commerce is something we want to profit by, we want our companies to grow, we want our sellers to sell on e-commerce, we are an SME-dominated country, we want those companies to prosper” she added.

 

The commerce secretary also stressed upon the need to spruce up banking policy to serve the needs of small manufacturers, services sector and exporters. 

 

She said the commerce ministry provides both guarantees and insurance for export finance through various schemes like merchandise exports scheme. 

"But these alone cannot make a difference and it is necessary for the banking sector and financial institutions to be more sensitive to these sectors," Teaotia said. 

Stressing on the importance of like gems & jewellery, pharma and handloom sectors, she pointed out that these sectors offer good potential to excel.

 Ms Teaotia also stressed that India must look at sectors where it has the potential to be a champion. "Our focus in terms of policy, initiative and effort is on actually improving the competitiveness of Indian products and Indian industry."

 


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