Govt to give more incentives to sectors promoting exports

As manufacturing has started showing signs of revival after a two year of slow growth, the Centre is planning a slew of measures to enhance its share in exports and may give some tax concessions to states which set up export promoting manufacturing units.

Discussions are on in the commerce ministry on how to increase manufacturing output of each state in order to enhance India’s share in global exports after a marked revival in demand in western economies, especially US and Europe. 

After lagging behind for a long time, exports registered three consecutive months of growth in the current financial year. From April to June this fiscal 9.3 per cent to $80 billion. The sectors which have contributed to the growth in exports are engineering goods, petroleum products and textile.

“Taking a cue from the exports figures, the ministry is trying to focus more on sectors such as textiles and engineering goods to begin with. This also has an added benefit of employment generation,” according to an official.

A National Textile Policy is on anvil to boost textile exports, he said. An expert committee constituted by the government has given its recommendation which aims at enhancing India’s textile exports eight-fold to $300 billion in the next 10 years. According to brokerage firm Edelweiss, India is one of the fastest growing exporters of engineering goods trailing only  China among major engineering exporters.

Engineering sector with 20 per cent contribution to India’s total exports, continues to be one of the top contributors to the total Indian export basket. In merchandise goods category, this is the largest foreign exchange earner. Engineering exports from the country mainly include transport equipment and capital goods.

Suggestions are also being made to states to work on a system which facilitates deputing officials  devoted to export promotion. Under this measure, the states, which promote export of manufacturing goods will be given tax concessions on setting up manufacturing units, the official said.