In­dia China Trade: Ex­porters ready to push the limit Pro­ject

ex­porters ready to push the limit

Cargo Talk - - Contents - RATAN KR PAUL

Ac­cord­ing to the Fed­er­a­tion of In­dian Ex­port Or­gan­i­sa­tions (FIEO), in­creas­ing mar­ket ac­cess to China is vi­tal for a quan­tum jump in In­dia’s ex­ports. A to­tal bi­lat­eral trade of US$ 100 bil­lion be­tween In­dia and China by 2015, along with pro­jected ex­ports worth US$ 40 bil­lion will nar­row the trade deficit with China.

We are aim­ing for dou­ble-digit growth in ex­ports to keep trade de­fieits within man­age­able limit.”

M Rafeeque Ahmed Pres­i­dent, Fieo

Atrue re­flec­tion of the ex­po­nen­tial growth in bi­lat­eral trade of the two coun­tries, from just US$ 7.6 bil­lion in 2003 to US$ 66 bil­lion last year; China is emerg­ing as one of In­dia’s largest trade part­ners. The two-way trade be­tween In­dia and China is ex­pected to touch $100 bil­lion by 2015, a 50.6 per cent higher than $66.4 bil­lion recorded in 2012-13.

Wel­com­ing the re­cent state­ment of the Prime Min­is­ter of In­dia on the eco­nomic co­op­er­a­tion with China, M Rafeeque

Ahmed, Pres­i­dent, FIEO said that in­creas­ing mar­ket ac­cess to China is vi­tal as the coun­try is en­deav­or­ing to change its ex­port pro­file to China; from raw ma­te­rial to fin­ished and value-added prod­ucts. “Presently, mar­ket ac­cess is re­stricted for phar­ma­ceu­ti­cal, agro prod­ucts and IT ser­vices. This should be looked into by China so as to pro­vide an im­pe­tus to In­dia’s ex­ports in th­ese ar­eas. While bi­lat­eral trade of US$ 100 bil­lion by 2015 is within the realm of re­al­ity, I would like In­dia’s ex­ports to touch US$ 40 bil­lion by 2015 so as to bring trade,” he stressed.

The FIEO pres­i­dent also wel­comed the pro­posal of Chi­nese in­vest­ment in man­u­fac­tur­ing sec­tor, which will be a win-win sit­u­a­tion for both the coun­tries as China is los­ing its com­pet­i­tive edge in man­u­fac­tur­ing, which will fur­ther ac­cen­tu­ate with grow­ing pop­u­la­tion. On the other hand, In­dia will be ben­e­fited with tech­nol­ogy trans­fer­ence and work-cul­ture, and the move will help in in­creas­ing the

man­u­fac­tur­ing share in coun­try’s GDP, a ba­sic ob­jec­tive of new Man­u­fac­tur­ing Pol­icy. Link­ing of In­dia’s North East Re­gion with Bangladesh, Myan­mar, China and other South-East Asian re­gions will strengthen In­dia’s eco­nomic link­age with th­ese coun­tries.

“With growth in bi­lat­eral trade and In­dia and China pur­su­ing part­ner­ships, busi­ness plans, and stronger ties with each other, th­ese two Asian gi­ants are ex­pected to dom­i­nate world trade and econ­omy in the com­ing years,” ob­served Ahmed.

Com­ment­ing on the re­cent ini­tia­tives by FIEO re­gard­ing the strength­en­ing of trade with China, Ajay Sa­hai, DG and CEO, FIEO in­formed Car­goTalk that the Fed­er­a­tion has been fo­cussing on this im­por­tant mar­ket, with fre­quent and large par­tic­i­pa­tion of In­dian busi­ness­men in im­por­tant in­ter­na­tional exhibitions like Can­ton and SACTF (South Asian Coun­tries Trade Fair) over the last few years. FIEO had or­gan­ised four con­sec­u­tive par­tic­i­pa­tions ear­lier in the SACTF, Kun­ming, which has now been up­graded to the 1st China South Asia Expo, Kun­ming sched­uled in June 6-10, 2013. At this show, the ex­po­sure to MSME seg­ment helped In­dian ex­porters in their mar­ket­ing ef­fort as well as prod­uct de­vel­op­ment. The del­e­ga­tion com­prised of around 90 In­dian com­pa­nies in 128 booths, ex­hibit­ing a wide range of prod­ucts such as well­ness prod­ucts, jewellery, elec­tronic items, tex­tiles and

At the present, half of the coun­try’s ex­ports are to Asian coun­tries”

Ajay Sa­hai dG and ceo, Fieo

gar­ments, wool­lens, pro­cessed food, gifts and pro­mo­tional items, hand­i­crafts, me­tal ware, kitchen­ware, home fur­nish­ings, leather footwear and wooden fur­ni­ture.

In­di­ca­tions for fy 2013-14

Ac­cord­ing to the FIEO Chief, the new fi­nan­cial year has started on a pos­i­tive note and In­dian ex­porters look for­ward to build on it. “We are aim­ing for dou­ble-digit growth in ex­ports to keep trade deficits within man­age­able limit,” ob­served Ahmed.

He fur­ther shared that that fo­cus on emerg­ing economies like In­done­sia, Viet­nam, Columbia, Saudi Ara­bia, South Africa and some other emerg­ing coun­tries would help in a quan­tum jump in ex­ports.

“The rise in gold im­ports is a cause of con­cern, but the soften­ing in gold prices is good news and will help in re­duc­ing im­ports value-wise. But there is a need to eval­u­ate ris­ing vol­ume-wise gold im­ports,” he main­tained.

He how­ever, cau­tioned that the ex­port fig­ures for May are in­dica­tive of the fact that the global re­cov­ery is still weak. The global growth has been un­even. “We have seen few green shoots in coun­tries like USA and Ja­pan, but the Euro­pean area con­tin­ues to be a cause of con­cern,” he pointed out. Even in

some large emerg­ing economies like China, Brazil, Rus­sia and South Africa, slug­gish ex­ter­nal de­mand and lack of in­vest­ment are pulling down econ­omy ac­tiv­ity.

It may be re­called that for FY 2012-13, FIEO had set an ex­port tar­get of US$ 350 bil­lion. How­ever, the ex­porters reached US$ 301 bil­lion. For FY 2013-14, they have set a mod­est tar­get of US$ 375 bil­lion. “In the FY 2012-13, we In­dian ex­porters face sev­eral chal­lenges be­cause of the over­all slump in the in­ter­na­tional mar­ket, even in the Asian coun­tries (0.4 per cent down com­pared to pre­vi­ous FY). At present, half of In­dia’s ex­ports are to Asian coun­tries,” Sa­hai pointed out. He, how­ever, was con­fi­dent that the tar­get set for the cur­rent FY is achiev­able due to re­cent in­no­va­tions by In­dian ex­porters and pos­i­tive ini­tia­tives by the govern­ment, like new MDA scheme, FTA ini­tia­tives and ex­plor­ing new mar­kets. Sa­hai also em­pha­sised on cost-com­pet­i­tive­ness and ef­fi­cient SCM to pen­e­trate emerg­ing mar­kets like ASEAN (es­pe­cially In­done­sia) and BRICS coun­tries. “E-com­merce is an­other im­por­tant seg­ment that In­dian ex­porters need to fo­cus on,” he added.

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