The Hindu Business Line : New trade policy to focus on labour-intensive exports

The Minister for Commerce and Industry, Mr Anand Sharma, flanked by the FICCI President, Mr Harsh Pati Singhania (right), and the Commerce Secretary, Mr Rahul Khullar, at the Board of Trade meeting in the Capital on Monday.

Our Bureau

New Delhi, Aug. 10

The forthcoming Foreign Trade Policy (FTP), to be announced by the end of this month, would have a long-term vision with the focus on helping labour-intensive export segments in this downturn time, the Union Commerce and Industry Minister, Mr Anand Sharma, said here.

Addressing mediapersons after his interaction with the reconstituted Board of Trade members, Mr Sharma said that “for the labour-intensive industry exports especially agriculture, textiles, leather, gems and jewellery, I would like to make a specific announcement or the special dispensation which would underline the sensitivity of the Government towards issues of employment. We hope that after consultations with the Finance Minister, Mr Pranab Mukherjee, we will be able to give more encouragement to exports, possibly in the new FTP.”

In his address to the Board, Mr Sharma said that “it is my intention to use the opportunity of announcing the FTP to outline the contours of policy instruments available with the Government for strengthening exports, especially the labour-intensive industry.

“In this regard, I would like to move away from the traditional approach in which FTP has been defined so far which is largely driven by fiscal incentives to exporters which are important measures but limited ones. I would like to give a holistic policy perspective of the Government of India on the institutional mechanism which we establish for strengthening the hands of our industry.”

Interacting with the Board members, Mr Sharma highlighted that apart from fiscal incentives, another issue which is coming in the way of increasing exports and needs to be tackled is trade transaction costs for exports and there are procedural bottlenecks which impede efficiency and constrain our export growth.

“I would like to establish an inter-ministerial task force, which will oversee its implementation, and also discussed with the members about the global economic slowdown and possible measures required to enhance India’s export competitiveness,” he added.

More dialogue s with States

During the discussions, Mr Sharma said, “next month, we are going to convene the meeting of the Inter-State Trade Council which will be its first meeting.

The rationale for having this meeting is to have a closer interaction between Centre and States. Our Ministry should give greater focus on an inter-active dialogue with the State governments on a regular and sustained basis.”

Mr Sharma said that “the Government is fully geared up to tackle the export situation and it is being monitored at the highest levels. Steps have been taken; steps will be taken and those will get clearly reflected in the new FTP.”

Asked if there were signs of revival in the economy, the Minister said, “exports are on downslide since October 2008 and the dip is about 30 per cent in the first quarter of 2009-10. We can’t say there is growth in demand but some sectors like pharmaceuticals are showing encouraging growth.”

Industry view

Business Line spoke to a cross-section of members of the Board. The President, Federation of Indian Exports Organisation (FIEO), Mr A. Saktivel, said, “The export industry needs some ad-hoc measures to tide over the present crisis.

“We have asked the Government to set up a committee for export growth linked with employment. We are looking for an umbrella organisation which should look into all facets of international trade and have agreed that FIEO can be the nodal agency for this purpose.”

The Apparel Export Promotion Council Chairman, Mr Rakesh Vaid, said, “The apparel industry has sought that products like fabrics, silk products, home textile should also be included under the focus product scheme to facilitate export growth. It has also been suggested that the Board of Trade meet once in every quarter to evaluate exports and suggest measures for boosting it.”

The Assocham President, Mr Sajjan Jindal, said, “We didn’t talk industry specific. The core, however, was how we could increase the exports from India in view of the global crisis. The Government has been responsive to the industry needs.”

The FICCI President, Mr Harsh Pati Singhania, highlighted the need for an umbrella body for export promotion on the lines of similar agencies in Korea, Japan and the UK to be established on public-private partnerships mode, involving apex chambers, export promotion councils, India Trade Promotion Organisation and the Government for joint export efforts.

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