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Shri Kamal Nath, Union Minister of Commerce & Industry, has said that India will take up the issue of non-tariff barriers (NTBs) in the World Trade Organisation (WTO) Doha round of multilateral trade negotiations, which are expected to gather steam from March 2005 onwards. “Imposition of non-tariff barriers by the West including the European Union (EU) is the biggest challenge that our exporters have to face”, he has said.
A number of ideas and proposals emerged during the Minister’s 4-hour long interaction with exporters at the review meeting convened by him here on Saturday on Export Performance and the New DEPB scheme. The Minister asked MMTC and State Trading Corporation (STC) to set up large warehouses abroad to facilitate the efforts of export agencies like Agricultural Processed Foods Export Development Authority (APEDA) and Marine Products Export Development Authority (MPEDA) as this would help reduce their transaction cost substantially. He urged MPEDA to aim at exporting tuna fish to the tune of Rs.1000 crore per year in view of its tremendous potential. India’s earning from tuna exports are expected to be only around Rs.100 crore this year.
Exporters expressed strong concern over the high cost of power in India which adversely affected the country’s export competitiveness. As the Federation of Indian Export Organisations (FIEO) put it: “In India, power rates are 13.5 cents per kilo watt hour, whereas international rates are only 4 cents per KWh. If you take power generated by generators also, then it is 17.5 cents KWh -- then where is the level playing field?” Apparel Export Promotion Council (AEPC) also referred to the same problem, pointing out that the cost of power was Rs. 8 per garment in India whereas in China it was only Rs. 2 per garment. “So how do we compete with Chinese products”, they asked. They also urged the government to have a state-owned cargo shipping mechanism as exporters were otherwise always at the mercy of private shipping agents who hiked freight. Shri Kamal Nath assured that a regulatory framework would be brought for shipping companies and agents to ease the problems faced by exporters.
The consistent of growth of Indian exports despite the strengthening of rupee, higher oil prices and congestion at ports reflected the resilience of the Indian exporters, Shri Kamal Nath said. However, he urged them to go for greater value-addition in sectors like gem & jewellery and leather which had a high potential in terms of employment generation and particularly in leather, could also create ancillary rural industries.
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