Import, Export, Trade for MSMEs: Union Minister of Commerce and Industry Piyush Goyal on Monday suggested to exporters to make adjustments in prices for the time being to address short-term challenges and retain market share as per a report by the Press Trust of India (PTI).
Addressing a meeting of representatives of export promotion councils, the minister also called for exploring export potential of unique products such as castor. He further instructed officials of the ministry to promote these products.
India’s export growth has been moderating for the last few months. However, the country’s exports rose by 4.82 per cent to $35.45 billion in September, even as the trade deficit widened to $25.71 billion.
The minister “told industry to strive to retain export markets even if they are to make temporary changes in their pricing structure to accommodate short-term challenges”, said an official statement.
The disruptions in the global trade can be utilised by occupying the space left vacant by certain other countries, suggested Goyal. He further asked officials to analyse export data according to sector, commodities and markets to find out areas of opportunity for the country’s exports.
“The minister called for open channels of communication between export promotion bodies and industry bodies with the government so that issues being faced may be flagged and resolved at the earliest,” the statement added.
During the meeting, exporters raised several issues and asked to extend support measures to the services sector and create export credit refinance facilities. In addition to that, they urged for the withdrawal of the 15 per cent export duty on stainless steel and alloy steel items as the duty had led to reduction in engineering exports.
The government’s apex organisation for trade promotion, Federation of Indian Export Organisations (FIEO) also asked for the restoration of the interest equalisation benefit of five per cent to manufacturer MSMEs as the increased cost of credit is affecting exporters.
An FIEO official said, “With headwinds being faced in merchandise trade, we need to push our services exports in the current fiscal so that we have the necessary cushion both on trade deficit and current account deficit.” He further added that exporters should also be encouraged to invest in export marketing through tax deductions.
Trade and investment promotion organization, Engineering Export Promotion Council (EEPC) raised issues around payments with Russia, alternative payment mechanism for Myanmar and withdrawal of EU (European Union) GSP (Generalised System of Preferences). Under the GSP, a preferential tariff system, the EU provides duty concessions to goods coming from vulnerable developing nations.
Arun Kumar Garodia, Chairman of EEPC India in a statement said that Russian bank Sberbank is charging a higher exchange rate than the market, leading to increasing transaction cost. He also pointed out that there are about 12 or 13 small Russian banks which are not on the sanctioned list, and they are transferring the payments from the Russian side to the Indian exporters’ banks in US dollars.
He also said that public sector banks like Bank of India and Union Bank of India are crediting the payments to the exporters’ accounts and giving the BRC (Bank Realisation Certificate). “However, private sector banks are not doing that and banks like Axis Bank are not even handling documents or giving packing credit,” stated Garodia.