After having witnessed a robust export growth of 37.6% in 2010-11, the government is now eyeing a doubling of exports to $500 billion by 2013-14. It has drawn up a ?four-pillar strategy? to achieve this.
Briefing media here on Tuesday, Commerce and industry minister Anand Sharma said the four pillars are product strategy, market strategy, technologies and R&D and building the Brand India for the world markets.
Elaborating on this, he said a technological up-gradation fund would be set up for the MSME sector, which accounts for a major chunk of India’s engineering goods exports. The idea is to improve the quality of products and upgrade the skills of workers. Also being planned is low-cost credit for new investments in capital goods and formation of chemical clusters.
The government feels that a national shipping regulator could be set up to keep a watch on the freight rates which currently are decided unilaterally, causing considerable uncertainty to exporters during the times of market upswing. This shall also reduce the tendency among shipping lines to impose extra chargers during the peak time of shipments. There is also a need to cut the fuel surcharge and season surcharges being levied on the exporter, the minister said.
For giving a boost to the labour-intensive sectors, the government has proposed creation of seven mega clusters for leather and also promoting corporatism in the traditional leather families. By this, the ministry is trying to equip the domestic leather industry to cater to the growing global demand. Flow of venture capital into the leather sector would be promoted through policy action.
Commerce secretary Rahul Khullar said,?the country is witnessing a product shift in its export basket. Engineering goods, drugs and pharmaceuticals along with chemicals and electronic goods will drive growth in the coming years.?
Currently, these sectors account to 31.9% of the export basket and after the strategy adoption the government aims to enhance their share to 39.2%.
Apart from this, the traditional export items are loosing their charm but still they will continue to contribute substantially. Sectors like, textiles, leather and handlooms contribute 10.7% of total exports which might decline to 9% in three years. Also, gems and jewellery which accounts for 16.3% of the exports, might slip marginally to 16%.
The ministry has targeted a modest growth of 20%-25% in exports for the current fiscal to $260-275 billion. Reacting to this, FIEO president Ramu Deora said, ?we welcome this strategy as it talks about a stable policy environment and continuation of existing incentives schemes, however, the ground realities are are little different. But, if government provides a level playing field to the manufacturers, imports to the tune of $50 billion could be squeezed providing domestic manufacturing additional opportunity thereby creating employment potential in the country.?