Exports have to be promoted on priority basis: Digvijay Singh
Aamir H Kaki
Exports have to be promoted on priority basis and there have to be tax incentives as far as exports are concerned, Digvijay Singh, Member of Parliament, Rajya Sabha and General Secretary, Indian National Congress said while speaking at The Dollar Business Power Series Conclave, held in New Delhi on 24th August.
“India’s exports have witnessed a CAGR of 15 percent in the last 10 years but in the last 2 years, on year-to-year basis, about 14.7 percent to 18 percent decline has taken place in exports. This is a matter of concern, which government of India has to look at,” he said.
In order to promote exports from the country, he suggested there have to be some kind of incentives. “Why can’t we have subsidised interest rates on export credits, which people look at. Ultimately, it leads to the growth of the economy,” he said.
“As compared to other Asian countries India has higher rate of interest on export credit. In India it is 14 percent, whereas in most of the Asian countries it is less 5 percent,” he added.
Singh further said that India’s manufacturing sector is a growth driver for exports and the country has to increase the sector’s share in GDP. “As it stands today, manufacturing sector is almost stagnant. Presently, it contributes roughly about 16 percent to the country’s GDP. On the other hand, China’s manufacturing sector contributes roughly 34 percent to the GDP. Our share in global manufacturing percent is 1.7 percent while the share of China is 13.7 percent. Manufacturing sector by itself is a growth driver for exports which creates employment and business opportunities,” he said.
He also referred that in 2011, the then government of India came up with a very aggressive manufacturing policy, which has been renamed as ‘Make in India’ by the current government.
“We had a very ambitious manufacturing policy, where we wanted to raise the manufacturing sector’s share from 16 percent to 25 percent in 2022 and to add one million jobs. Although, the current Prime Minister has promised 20 million jobs in a year, I think it is too farfetched,” Singh said.
Presenting the examples of other Asian countries, Singh said, “Japan China and South Korea are shining examples where greater stress on manufacturing sector, greater attention towards exports has mainly led to an exponential growth as far as their economy is concerned.”
“I think a little bit of effort, a continuous growth rate of 8 percent and with aggressive economic reforms, coupled with better environment for ease of doing business, we can achieve the target,” he added.