A committee member of the UPA told FE, The committee will take stock of the Foreign Trade Policy and measures taken by the government to help problem-ridden exporters in the country. Even though India has not been as affected as other economies, exports have suffered a decline in the last 11 months due to a contraction in demand in our traditional markets. Indias exports in dollar terms showed a growth of about 48.1% from April to September 2008, whereas from October 2008, it started declining, bringing down the cumulative annual growth to 13.6% in 2008-09. The committee member also added that the government has already taken a slew of measures, including fiscal incentives, institutional changes, procedural rationalisation, enhanced market access across the world and diversification of export markets.
The committee will also analyse the current economic crisis and its impact on trade and industry. The impact has also been felt in the financial sector, exports and exchange rates. The impact of the global meltdown was felt in India first in the stock market, then percolating to shortage of funds for the domestic industry and reduced demand for Indian goods, on account of a decline in international and domestic requirements. The slowdown in investment demand led to a moderation in the capital goods sector, which was spread across machinery and equipment, machine tools, textile machinery, refrigerators and air conditioning. However, after registering a negative growth in the last quarter of 2008-09, the demand/production for consumer durables has improved in the first quarter of 2009-10. The production of passenger cars increased by 22% and of two wheelers by 15%. The index of six core industries, which witnessed a significant deceleration, has shown positive growth, the committee member added.