Government ready to improve competitiveness of Indian exporters: FM
Taking note of the falling exports from the country, Finance Minister Arun Jaitley has agreed to take prompt measures to improve competitiveness for Indian exporters in the international market. The government data shows that India’s overall merchandise export in the first two months of the current financial year has contracted by more than 17% to $44.4 billion as against $53.6 billion registered during the same period a year ago. Trade analysts say that the lack of competitiveness of Indian exporters and their product in the global market is the main factor behind the country’s falling exports. On Friday, a delegation of exporters led by SC Ralhan, President of Federation of Indian Export Organisations (FIEO), met the finance minister and discussed various issues faced by the community. According to exporters, increased interest rates on credits given to exporters and high transaction cost due to the lack of infrastructure facilities are hampering India’s exports. The high cost of credit which needs to be addressed immediately by introducing interest subvention scheme from April 1, 2015, and availability of Pre-Shipment Credit in Foreign Currency for MSME (micro, small & medium enterprises) were major issues discussed during the meeting, FIEO said in a press statement. “Finance Minister said that he was worried over the declining export. He assured us that the government will look into all our concerns. But when the government will do it and how, it’s a million dollar question,” Ralhan told The Dollar Business. To improve liquidity for exporters, FIEO suggested that the tax refund in the form of duty drawback, CENVAT and service tax should be given to the exporters within 10 days. In order to encourage the MSME sector for adopting new technology, Ralhan asked the government to increase the threshold limit for Credit Linked Capital Subsidy Scheme (CLCSS) from Rs.1 crore to Rs.5 crore. The exporters’ body also asked for market development support either through a planned scheme with sizable corpus or through tax deduction under income tax for overseas expenditure relating to marketing. “The government should encourage more and more Indian companies to take part in exhibitions and promotions abroad. This will enable traders to explore new markets,” Ralhan said. To reduce transaction cost, the delegation suggested several measures like time-bound implementation of EDI (Electronic Data Interchange) among all community partners by March next year, permitting single MEIS (Merchandise Exports from India Scheme) application for all EDI ports, acceptance of tracking report at least in respect of status holders, and dispensing with verification of scrips. India’s export has been on negative path since past six months. In March last year, the country’s exports fell by 21% fall, lowest in the last six years.
July 6, 2015 | 6:49 pm IST.