Ans. To achieve a respectable share of 5 per cent in World exports,
India’s export growth rate (CAGR) has to be around 26.5 per cent for at least 5
years (2017-2021) assuming that global growth continues at the CAGR of 1.5 per
cent (2010-15). For this some major strategies and trade policy reforms are
needed along with specific measures.
1. Demand based export basket
diversification rather than a mere supply based strategy as the ranks of items
at 4 digit level in world top imports and ranks of India’s exports of these
items to the world show a great deal of mismatch with India exporting 96.5 per
cent of items in the World’s top 100 import items at 4 digit level and 83.2 per
cent at 6 digit level in terms of numbers in 2015, which however constitute
only 1.6 per cent of top 100 world imports in value terms.
2. Rationalizing tariffs as the realized
tariffs (BCD) is very low at 2.8 per cent in 2015-16 and less than one fourth
the average applied tariffs due to various exemptions. If refunds and customs
duty drawbacks are deducted from gross customs revenue then the net realized
tariffs (BCD) would be still less. Though different rates of tariffs are levied
for various reasons, there is scope for reducing average applied tariffs by
selectively reducing tariffs across many lines, while retaining higher tariffs
for sensitive and important items. Consequently WTO bound tariffs could also be
reduced which can help India to take a more pro-active role in WTO and
bilateral negotiations.
3. Streamlining Export Promotion Schemes
as many duties have been subsumed under GST and if tariffs are reduced to
realized or near realized levels, some export promotion schemes can be phased
out. The duty drawback rates can also be revised downwards. The revenue saved
could be used for export marketing efforts.
4. Developing on a war footing world class
export infrastructure and logistics especially port-related
5. FDI linked and Value Added Exports
particularly high-tech exports as in China and some ASEAN countries.
6. Having useful FTAs/CECA’s with some
major countries while actively expanding engagement with BRICS and ASEAN where
India enjoys competitive advantage.
7. National Priority Sector for Exports
and greater States’ participation in exports by linking devolution of funds to
states with export effort of states.
8. Formulating a clear-cut Agri Trade
Policy
valid answer
ReplyDelete