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FIEO buoyant, hopes exports will rise to touch $270 billion this fiscal

KOCHI, MARCH 16:
Buoyed by last month’s double-digit growth in exports, the Federation of Indian Export Organisations (FIEO) is looking at more export-friendly measures to sustain the growth rate.

“We have to look into the exchange rate closely to maintain the growth rate on account of the fact that the rupee is all set to appreciate against major currencies and it will affect India's export competitiveness,” Ajay Sahai, Director-General and CEO, FIEO, told BusinessLine.

Govt support

Asked whether FIEO has suggested any exchange rate support measures, Sahai said, “Since rupee is expected to appreciate as compared to our competitors’ currencies, the government may provide additional incentives to exporters to offset losses on the exchange front.”

Sahai, who was in Kochi for an official meeting, said the government needs to look into the Interest Equalisation Scheme for merchant exporters, who continue to contribute 30 per cent of the country’s exports.

At present, only manufacturers are availing themselves of this benefit and it should be extended to other sectors as well, he said.

On the achievement of the 17 per cent growth rate in February, he said that this is for the first time that the country has achieved a double-digit export growth after more than three years, thanks to firming up of commodity and metal prices. “The trends are very encouraging, especially at a time when major competitors such as China, Thailand and Japan posted negative growth,” he said.

Global slowdown

Though the slowdown in global trade is a concern, Sahai said, export figures are likely to touch $270 billion in the current fiscal, going by the current trend. Growth in exports of rice, spices, cashew, oil meals, marine products, engineering goods, organic and inorganic chemicals augur well for the future, he added.

FIEO, the apex body of exporters, is also pinning hopes on the government's move to introduce 24x7 Customs facility in 17 airports and 17 seaports shortly. This was FIEO's long-pending demand, which was put on hold by the government due to shortage of officers.

The introduction of the facility, he said, is expected to be operational within six months, which would further ensure ease of doing business.

Exports to the US

Moreover, with implementation of GST, the availability of Customs officers for the job would be on the higher side. Answering a question on the prospects of Indian exports to the US under the Trump administration, Sahai said India is shipping only medium-value items such as garments and leather commodities to US and this would go uninterrupted.

“Except for H1-B visa hassles and software exports to the US, we do not find any serious impact to Indian merchandise,” he said.

Quoting an FIEO analysis, Sahai said the country stood to gain from the tariff imposed on Mexico.

The top 20 items from Mexico are valued at $193 billion with zero per cent duty while similar export items from India invites duties.

By imposing duties for Mexican exports, there would be an opportunity for the country to mop up its exports, which is currently valued at $121 billion.

Source: The Hindu Business Line
Added On: 2017-03-18