Financial Daily from THE HINDU group of publications
Monday, Apr 01, 2002
Industry & Economy - Exim Policy
Bleak export scenario set to change: Maran
NEW DELHI, March 31
THE Union Commerce and Industry Minister, Mr Murasoli Maran, is "optimistic" that the "comprehensive" export-import (Exim) policy he unfurled today for the next five years (2002-07) would alter the "export scenario, which is disturbing now and might continue to be so until March 2002." (The export figures for March 2002 are yet to be released.)
In an interview to Business Line in his Udyog Bhavan office, a relaxed Mr Maran said that the fiscal year 2001-02, which came to a close today, was one of the worst years. Though the January 2002 export figure recorded 18-per cent rise in dollar terms, it was now being "corrected to 15 per cent and the last two months (February-March) normally are low months. I don't think we will achieve the lowered three per cent export target for 2001-02."
He quipped that he had not tampered with any of the existing export promotion schemes or added to the problems of exporters. "In view of the disturbing situation, we have not disturbed the existing export schemes."
Recounting the important initiatives in the new policy, the Minister said that "SEZs are our best hope and we have put a policy package in place today." He described offshore banking units (OBUs) to be set up in SEZs as "a path-breaking one, which will act as a magnet for attracting foreign direct investment. The simple equation is that Indian exports mean Indian jobs, more Indian exports mean more Indian jobs."
Second, he said, "we have taken care of agriculture. Agro export zones would go a long way in helping our farmers, besides providing them a vital link to international trade." He said, "We have not forgotten the small-scale sector and cottage industries as they provide 50 per cent of our exports."
Mr Maran said that up till now, "we have been able to provide assistance to software sector only. Hence, we are giving some stimulus to hardware in which we are lagging behind all our East Asian brethren."
He admitted, "It is a tough task to compete with them. But today we have made a beginning and we may not be immediately competing with most of the sophisticated hardware items; but to begin with we can concentrate on keyboards and other items."
To a specific query as to the likely misuse of offshore banking units in SEZs for money-laundering purposes, the Minister said that the "RBI will take care of all these problems." The idea, he said, was to help SEZ developers and units located there to access credit at international rates so that the cost of capital would become lower. "For, smaller companies now need not go to Europe or America for GDR or ADR issues and they can get international credit sitting here," Mr Maran said. e said that as India remained pre-eminent in diamond trade with a 50 per cent share in value, 80 per cent by volume and 90 per cent by caratage, he had provided several incentives to this industry so that India emerged as one "of the hubs of diamond trade" and gained strength in the export of value-added jewellery items.
On the role of the Directorate-General of Foreign Trade (DGFT), Mr Maran said that the Expenditure Reforms Commission had not suggested any abolition. He said 1.5 lakh exporters producing an export turnover of Rs 2,00,000 crore in the country need the "servicing by DGFT." By introducing electronic data interchange (EDI), we had "downsized" the role of DGFT, Mr Maran added.
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