Following a declining trend
in merchandise exports for some years in the past, Indian exports picked up in
April-June quarter this year, with May 20% growth and June 18% and prompted by
this upward trend, the Central Government may target $400 billion annual
merchandise exports in two years. And the Union Commerce Ministry in
consultation with Federation of Indian Export Organisations (FIEO) is to
formulate a strategy to achieve the goal.
a sustained 20% exports growth from now, India’s merchandise exports can be
pushed to a little over $350 billion this year and $400 billion in the next
fiscal, FIEO President Ganesh Kumar Gupta viewed.
20% exports growth is sustainable, Gupta said recently emphasising that the
strategy needed to be aimed at high potential markets such as Africa and Latin
America. Indian textiles, handicraft, handlooms, leather, engineering goods,
pharmaceuticals and automobiles have a huge potential.
China is importing from India a lot of items like handicraft and carpets, and
the US-China trade war too has opened up a window of opportunity to push
exports to both Beijing and Washington. However, this needed to be worked
upon," he said. The Commerce Ministry-FIEO joint strategy will be readied
shortly, he said.
H A C Prasad, who recently retired as Senior Economic Advisor in the Finance
Ministry, has come out with a study paper on the challenges and policy
initiatives needed to take India's merchandise exports to a new high. According
to him, with green shoots in merchandise exports it is only appropriate to
raise India's share in world exports to a 5%.
reach the 5% share, merchandise exports should hit $882 billion by 2022, which
means India's export growth rate needed to be around 27% CAGR for five years.
This is not impossible as India has had higher exports growth than this during
2004-09, Prasad said.
boost trade, India has to make its exports demand based rather than supply
based as at present.
has huge potential in increasing farm exports. The strategy is to raise farm
exports from the present $40 billion annually to $100 billion with improved
packaging and shelf life through better cold storage facilities.
farm production cost is the cheapest in the world and with an improved market
strategy, India could step up farm exports in no time.
specific steps were needed to improve Ease of Doing Business for exporters,
besides reduction in transaction cost, delay in ports to make Indian exports
competitive, Gupta said, adding a lot has been done but some unfinished tasks
have to be attended to.
suggested setting up of an ombudsman to resolve export related problems as
there is no clear cut dispute resolution mechanism at the moment.