Wednesday, April 9, 2008

Sectoral analysis suggests twin stragegy to make exports inclusive

by Jo Black

The Confederation of Indian Industry (CII) has suggested a twin strategy of focussing on manufacturing sectors - Textiles, Leather, Gems & Jewellery and Engineering, and a renewed focus on two large markets of Latin America and Caribbean (LAC) and Africa to make the benefits of export growth dispersed across India. This is in line with the Commerce Minister Mr. Kamal Nath’s vision of making exports an engine for inclusive growth.

In an occasional policy paper titled “India Export Series - Sectoral Analysis”, CII is of the view that in these four sectors India needs to be among the top three exporters in the globe, which accounts for more than 50% of India’s current export basket.

For achieving this there is a need for a combination of policy initiatives; technology infusion; infrastructure improvement especially freight lines and ports; access to newer markets; innovation in product development and improvement in scale of production. Since SME units dominate these sectors, CII calls for regular guidance and support to SME units to improve their efficiency.

While noting that diversification has been achieved in India’s export destinations in recent years, CII called for a ’strategic push’ in two big markets of Africa and LAC countries. Currently India satisfies just 3.5% of Africa’s import demand and just 0.7% of import demand of LAC countries. CII is of the view that these shares can easily be doubled with minimum efforts in the next two to three years.

CII expects India’s exports to reach US$ 500 billion by 2013, if the past growth trend continues. India’s exports for the fiscal year 2007-08 are expected to be between US$ 155 billion and US$ 160 billion from US$ 126 billion in 2006-07. The foreign trade policy (2004-09) expects India’s exports to reach US$ 200 billion by the year 2008 - 09.

 

 

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