Economy

FIEO to work with Kerala govt to double its exports

V Sajeev Kumar Kochi | Updated on July 04, 2019 Published on July 04, 2019

Israr Ahmed, Regional Chairman-Southern Region, FIEO

Federation of Indian Exports Organisations (FIEO) intends to work closely with the Kerala government to double the State’s share of exports to over six per cent in the next five years. Kerala’s exports during 2018-19 was $8.1 billion, which is 2.4 per cent of India’s exports.

“We need to see how we can double this figure. The agri sector is going to be the biggest contributor to exports”, said Israr Ahmed, Regional Chairman-Southern Region, FIEO.

In an interaction with BusinessLine here on Thursday, he requested the State government to look into the possibilities of augmenting exports of agro products such as cashew, spices, rubber, marine products and tea, which are not under the sanctioned list, to China and Iran.

Direct exports

According to him, direct exports from Kerala to Iran is negligible even though cashew, spices, pharma equipments have good potential. Ahmed said several products exported to GCC from Kerala find their way to Iran. If proper attention is given, this can be channelised and exporters can derive better benefits.

Asked on the challenges for exports to Iran amidst US sanctions, he said Iran is an opportunity for India, as the bilateral trade was $13.8 billion in 2017-18. However, the actual trade will be in the range of $20-25 billion, which is conducted indirectly due to sanctions. “We believe this can go up to $30 billion, if there is a barter mechanism for direct trade”, he said.

However, there are issues pertaining to payments, shipments, exchange of documents and insurance that will have to be addressed, he added.

Lack of proper marketing is hindering export growth and he emphasised the need for bringing more international fairs to Kerala to leverage the opportunities. “ For Kerala to increase its share, there is a need for giving more focus on MSME exports, helping them in marketing and showcasing their products abroad”, he added.

The current support extended through various schemes are grossly inadequate and FIEO urged the Commerce Ministry to come up with an export development fund with a corpus of 0.5 per cent of export value for each State, so that MSME's can aggressively participate in international expos and trade shows.

Kerala is also one of the major foreign exchange earner through tourism. There is a huge potential for the State to double the revenue from the sector. The export sector can also generate huge employment opportunities similar to neighbouring States such as Tamil Nadu and Karnataka, he said.

Considering the creation of employment as the biggest challenge being faced by the country, he said FIEO requested the government to provide income tax relief to units which provide additional employment in export sector. Such a scheme will help workers to move from informal employment to formal employment. Incentives may be provided based on twin criteria of incremental growth in exports and incremental growth in workers so that while on the one hand exports are increased, on the other, the employment intensive units also get a boost.

Published on July 04, 2019
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