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With merchandise exports in June shrinking – the third such decline starting March – some incentives for exporters are in the offing.
The measures, mainly for export promotion activities and reducing transaction costs, could be announced by the Commerce Ministry within a fortnight, sources told Business Line .
The Ministry will also take up with the Reserve Bank of India, Finance Ministry and banks the issue of difficulties being faced by exporters, especially in tier-II and tier-III cities, in availing themselves of dollar denominated credit, they added.
The Commerce Secretary, Mr S.R. Rao, and the Director-General of Foreign Trade, Mr Anup K. Pujari, on Friday kicked off consultations with the Federation of Indian Export Organisations in Mumbai to get inputs for measures that exporters need to at least retain their current share in the overseas markets.
Another such meeting will be held in Hyderabad on Saturday. Later, the Ministry will also meet exporters in Chennai and Kolkata.
Considering the tight fiscal situation, the Ministry will not hand out sops that will pinch the Government’s pockets. This means the focus will be on schemes such as Market Access Initiative (MAI) and Market Development Assistance (MDA).
Under MAI, more markets and products would be added and there would be increased financial assistance to Export Promotion Councils, trade bodies and Indian Commercial Missions abroad for participation in trade fairs, publicity campaigns and brand promotion, testing charges for engineering products, as well as reimbursement of registration charges for pharmaceuticals and expenses for carrying out clinical trials in fulfilment of statutory requirements in the buyer country.
Additional assistance may also be given for contesting anti-dumping litigations in the wake of rising disputes in the prevailing protectionist environment.
Under MDA, there would be additional financial aid for trade fairs, buyer-seller meets and seminars overseas and in India, as well as travel grants.
Exports for the first quarter this fiscal (April-June 2012) shrunk 1.7 per cent to $75.2 billion. Barring drugs and pharmaceuticals, most major exports have seen a contraction.
Shipments surpassed the $300-billion target to touch $303 billion in 2011-12.
However, if the trend seen in the first quarter and the weak demand in major markets such as the US and European Union, the contraction in China and distress in Japanese market continue, the $360-billion target for 2012-13 would be difficult to meet, industry sources said.
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