At a meeting with exporters and industry, commerce and industry minister Piyush Goyal asked them to keep prospecting for new opportunities in the world market to expand trade and do a deep dive of services imports.
“Goyal today said that India would accord top priority to national interest in FTA negotiations,” the commerce and industry ministry said in a statement.
“FTAs to be entered into after thorough consultation with all stakeholders including industry and the government will not diverge from this approach for the sake of deadlines,” it said.
The statement assumes significance as India and the UK negotiate an FTA which currently in its final stages of negotiation towards a Diwali deadline.
The minister reviewed India’s export performance in the first six months of this financial year. India’s merchandise exports shrank 3.5% in September, contracting after 19 months with job creating sectors such as engineering, garments and cotton yarn being the worst hit.
At the meeting, industry flagged issues related to the rising of cost of raw materials and subdued demand in certain key export markets due to high inventory levels. It sought the inclusion of left out sectors under RoDTEP and rationalisation of existing rates under the scheme, exploring possibility for increased support under Interest Equalisation Scheme(IES) and under Market Access Initiative. Industry also sought operationalisation of Production-Linked Incentive (PLI) schemes for additional sectors.
“Highlighting the healthy growth seen in some markets such as Latin America and Africa, it was informed that the evolving economic and geo-political environment required the industry to be attentive and optimistic so that growth opportunities in such new markets are not missed,” the ministry said.
The Federation of Indian Export Organisations sought extension of previously granted exemption from Goods and Services Tax (GST) on ocean freight, while EEPc pushed for a roll back of 15% export duty on some stainless steel arguing that export duty is one of the key reasons for engineering exports’ downward trend in the last few months and a 17% contraction in September.
EEPC India Chairman Mahesh Desai said that withdrawal of export duty will be especially helpful for the MSMEs who have a significant contribution in India’s engineering exports.
“It was also recommended to include the steel sector under RoDTEP as steel is the most widely used raw material in the engineering industry,” EEPC India said in a statement.