Economic recovery to provide opportunity for India
The Production Linked Incentive (PLI) Scheme will be a game changer and put India’s focus on technology exports such as electronics, electrical machinery and automobiles, which accounts for over 35% of global imports, said FIEO President Sharad Kumar Saraf.
“The domestic capabilities in these sectors will also help to save over US$100 billion in imports annually on a recurring basis,” he said on 29 Jan 2021 in comments on the latest Economic Survey.
While the judicious intervention in the forex market has prevented one sided appreciation of Rupee, the Survey also admits that Rupee appreciated by 2.9% in terms of Real Effective Exchange Rate, noted Saraf, urging the Government to allow Rupee to reach its real value so as to provide further competitiveness to exports.
The better than expected economic recovery both globally and internally provides a huge opportunity for India to push its exports in pharma, medical equipment, PPE kits, technical textiles, networking products, food & processing products, cereals, steel, plastics, chemicals and iron & steel, according to Saraf.
The opportunities in the labour-intensive sectors are also gaining traction. However, a study should be conducted to understand why many of these products having high Revealed Comparative Advantage (RCA) are not figuring in our main exports (either in share or value), as pointed out by the survey, said Saraf.
The FIEO President said that while initiatives like Remission of Duties and Taxes on Exported Products (RoDTEP) are aimed at providing continued support to the industry, this requires immediate announcement of the rates as in absence of the rates, exporters are not able to do their export costing with a view to finalise new contracts.
Any further delay will have serious implications for future exports as exporters are in “wait & watch mood” before finalising new contracts particularly in sectors having thin margins, according to Saraf. #exporters #manufacturing #investment /fiinews.com
