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In a big upsurge on the export front, India’s merchandise exports in the month of November 2004 have registered a record increase of 26% over the same month last year. Announcing this at the Review Meeting convened by him on Export Performance and the new DEPB Scheme here today, Shri Kamal Nath, Union Minister of Commerce and Industry, said that in November 2004 alone India exported over US $ 6 billion worth of goods – i.e., an average of US $ 200 million a day. He urged the exporters to aim even higher, while complimenting them for their creditable achievement in spite of the rising oil prices, rupee appreciation and congestion at the ports. "With this our exports have so far crossed 46 billion dollars, and the cumulative rate of growth for the eight month period April to November of the current year works out to more than 24% over last year. We must not only keep the tempo up, but we must be ambitious enough to accelerate it", he said adding that exports this year were so far on target and were likely to reach US $ 75 billion during the current financial year 2004-05.
In a radical departure from the past practice of setting export targets on an annual basis at the beginning of the every financial year, Shri Kamal Nath announced that a target of US $ 75 billion was set for the current financial year 2004-05 and the export target would be US $ 88 billion for the next financial year 2005-06. The year after that, i.e., 2006-07 US $ 104 billion; after that, it would be US $ 125 billion and finally, for 2008-09, the target would be US $ 150 billion. Explaining the rationale for setting export targets well in advance, the Minister said since the goal was to double India’s percentage share in world trade within 5 years as indicated in the Foreign Trade Policy 2004-09, a sustained annual growth of 19% to 20% was required over the next 5 years and this in turn, would need advance planning. "In the past, targets were fixed on an annual basis at the beginning of every financial year. When this happens it is clear that no intensive planning can be done. It is no secret that the methodology adopted is a clever bureaucratic one. The trick is to estimate what can be comfortably achieved, and then set a target at a slightly lower level, so that at the end of the year, we could all pat ourselves collectively on our backs for a job well done! This may be the easy way of doing this, but it is certainly not the most effective. The correct way of target setting is to identify your goal, identify your time span and then calculate backwards, giving adequate planning time", he said. "Now, with the target for the current as well as four succeeding years clearly before us, we do not have any excuses about late decisions; we can plan intelligently and purposefully. This is the task and the challenge that I set before you", Shri Kamal Nath said.
Export growth rate this year has been particularly high in gems & jewellery (40%), ores & minerals (80%), engineering goods (40%) and chemical products (35%) while several other sectors have also done well. Regretting that disaggregated figures were available only till August, Shri Kamal Nath said that such a long time lag of four to five months in collecting sectoral statistics severely hampered efforts to analyse, identify bottlenecks and take corrective action in time. This, he said, would have to be remedied and informed that the entire system of statistics gathering would now be reviewed so as to reduce the time lag to a maximum of a month or two in or to enable quick response to developing bottlenecks.
Shri Kamal Nath said that the government has decided to introduce a new Export Promotion Scheme to replace the Duty Entitlement Pass Book (DEPB) Scheme and proposals had been invited from exporters, chambers of commerce and the public at large with more than 20 proposals having already been received on the issue. Given that DEPB covered more than 52% of Indian exports and as such, was the most popular export promotion scheme because of ease of operations, Shri Kamal Nath said that the new scheme should have superior features and should offer equal ease of operations and convenience. While meeting the genuine duty neutralisation needs, it should also not fall on the wrong side of the international trade agreements, he added. Regarding tariffs, the Minister pointed out that India’s import tariffs were being brought down to ASEAN levels and made it clear that the government would not subsidise inefficient industries. He also urged the exporters to take advantage of the emerging Economic Cooperation Agreements and Free Trade Agreements (FTAs).
Calling for a complete change of mindset, Shri Kamal Nath said: "The biggest problem is not our rules, the biggest problem is our mindset and this must change. Why do so many people come to the Ministry if everything is moving alright? There is nothing wrong in wanting to earn profits. Exporters are entitled to make profits. So, it is not a favour that you (i.e., the government and affiliated offices) are doing to them. It is your job to help them. Similarly, if exporters misuse or abuse various schemes, they do a great disservice to the entire exporting community. … The greatest credit to my Ministry will be if the exporters say that the export growth has been achieved because of the government and not in spite of the government".
Shri S.N. Menon, Commerce Secretary; Shri N.N. Khanna, Chairman, India Trade Promotion Organisation (ITPO); Shri K.T. Chacko, Director General of Foreign Trade (DGFT) and senior officials of the Ministry of Commerce & Industry participated in the largely attended meeting which saw the participation of all the major Export Promotion Councils (EPCs) and the Commodity Boards, including the Apparel EPC; Basic Chemicals, Pharmaceutical & Cosmetics EPC (CHEMEXIL); CAPEXCIL; Electronics & Computer Software EPC (ESC); Engineering EPC (EEPC); Carpet EPC; Gems & Jewellery EPC; Synthetic & Rayon Textiles EPC; Handloom EPC; EPC for Handicrafts; Plastics & Shellac EPCs; Indian Silk EPC; Wool & Woollens EPC; Sports Goods EPC; EPC for EOUs and EPZs; EPC for Project Exports; Pharmaceuticals EPC; Cotton Textiles EPC (Texprocil); Cashew EPC; and the Council for Leather Exports. Tea Board, Coffee Board, Rubber Boards, Spices Board, Tobacco Board, Coir Board, Agriculture & Processed food Products Development Authority (APEDA) and Marine Products Export Development Authority (MPEDA) also attended, along with a number of PSUs and other bodies such as the Exim Bank of India, Export Credit & Guarantee Corporation of India; MMTC; STC; PEC; Confederation of Indian Exporters; Directorate General of Commercial Intelligence & Statistics (DGCI&S) and Federation of Indian Export Organisations (FIEO).
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