The formula may come packaged with the March 31 announcement of the annual changes in the country's export-import policy, Maran told an open-house of exporters organised by the Federation of India Export Organisations.

He said the government wants a big jump in exports, and this is not possible without the active involvement of the state governments. At present, apart from gains in the country's foreign exchange reserves, neither the Union nor the state governments get anything from exports.

"Just a mere rise in the export growth will not help the Indian economy. We need a quantum jump and for that the involvment of the state governments is necessary. At present, their interests are restricted to employment creation. We are trying to work out a way whereby they are also involved in boosting exports," Maran said.

The minister has already had discussions with director general of foreign trade NL Lakhanpal. Maran said further discussions and clarifications were required from the Union finance ministry and the Planning Commission. However, he did not elaborate on the nature of the incentives being considered.

PK Shah, a former FIEO president, told The Financial Express that the incentives proposal has been doing the rounds for almost ten years, without any hint of specific measures.