The minister emphasised that exports can benefit the economy in a much shorter term than any other economic activity.
Commerce and Industry Minister Suresh Prabhu has made a case for treating support measures to promote exports as investment and not subsidies, arguing that outbound shipments contribute in a big way to boosting growth. The minister emphasised that exports can benefit the economy in a much shorter term than any other economic activity. “We feel very strongly that export should be considered as an investment and should not be considered as subsidy that we provide to exports. Because the large growth in exports benefits economy as a whole in a significant way,” Prabhu told PTI during an interview. Exports have both domestic and global benefits, he said, adding that on the external front, the outbound shipments create an economic footprint globally, which has its own geo- political advantages. “Export means somebody is importing, so we become part of the supply chain. The exporter also creates a constituency in that country… so, we have a huge benefit by doing that,” he added. Citing the example of China, he said the country has created several allies by becoming the largest exporter in the world.
An official said that as part of the Budget preparation, the commerce ministry would try to impress upon the finance ministry the need to treat exports as investments and not subsidies. On GST related concerns of exporters, Prabhu said the ministry has taken up the matter with the GST Council and exuded confidence that the issue would be resolved. “With regard to GST refund, there are some issues. We are constantly taking that up with the finance ministry to get it addressed,” he added. Exports in October had entered the negative zone again, dropping 1.12 per cent. The fall in shipment has been attributed to the liquidity problems being faced by exporters following the transition to the Goods and Services Tax.