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The new government that takes office next month must look at increasing the market development allowance used for promoting exports, Rafeeque Ahmed, President, Federation of Indian Export Organisations (FIEO) has said.
The amount that has been allocated in the budget is very small at just about Rs 150 crore which is a fraction of the Rs 18 lakh crore worth of exports, he said.
This amount should be increased to at least between 0.5-1 per cent of exports so that exporters can be helped to subsidise their marketing and brand-building expenditure. Such marketing expenditure was permissible under WTO rules and will enable exports to jump by 20 per cent or more, he said.
Exports in the just concluded fiscal ended March 31, 2014 were of the order of $312 billion against the target of $325 billion.
The new government must target a five-year plan to boost exports, Ahmed said.
Annual export target
He said that achieving annual targets were not feasible because it took the government six months to fix a target. The FIEO would propose a plan to help exports touch $750 billion over 5 years which reflects a compounded annual growth rate of around 20 per cent.
Ahmed addressed the media after a meeting with the Revenue Secretary Rajeev Takru, who was briefed on the procedural, taxation and pending legal issues that hampered export growth so that he would in turn be able to brief the new government on the necessary steps.
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