Financial Daily from THE HINDU group of publications
Monday, Apr 01, 2002
Industry & Economy
Maran bullish on 1 pc target -- Package for services export coming
NEW DELHI, March 31
A SEPARATE policy package for services exports is on the anvil, with the Commerce and Industry Minister, Mr Murasoli Maran, today announcing that an internal committee is close to finalising its recommendations.
"A special committee of the Commerce Ministry is working on services. You will soon see the results. We are unable to take a long-term view on services in the 2002-07 Exim policy because of the on-going trade negotiations in services under the World Trade Organisation (WTO),'' Mr Maran said at a news conference marking the release of the Exim policy.
The Government has also removed quantitative restrictions on imports in respect of a few items that formed part of the list of 600-odd items for which quantitative restrictions (QRs) on imports are in place.
"Last year, we had done away with all QRs on imports that were maintained for balance of payment considerations. Even after that, QRs on imports existed on about 600-700 items for reasons of national security and other importance. We have removed QRs on some items in this policy. QRs on imports will go gradually for more items after consultations with the administrative Ministries'', Mr Maran said.
The marked slowdown in exports during the current fiscal notwithstanding, Mr Maran expressed optimism that the Exim policy initiatives would help India capture the elusive 1 per cent share of global trade by 2007.
"In an inter-connected world, it is always difficult to hazard a guess on export growth targets. But we are very confident that our policy initiatives will aid in reversing the downturn in exports,'' Mr Maran said.
On whether foreign banks operating in India as branches would be permitted to set up overseas banking units (OBUs) in the special economic zones (SEZs), the Commerce Secretary, Mr Dipak Chatterjee, said that all banks that were considered to be `Indian banks' by the Reserve Bank of India would be allowed to set up OBUs in the SEZs.
Mr Maran had announced that the OBUs, which are being allowed to be set up for the first time in India, would be "virtually foreign branches of Indian banks, but located in India''. The OBUs would be exempt from the requirements of cash reserve ratio (CRR), statutory liquidity ratio (SLR) and would give SEZ units and SEZ developers access to international finances at international rates.
The Commerce Minister was emphatic that sops were necessary to achieve the targeted compounded annual growth rate of 11 per cent in the Tenth Five-Year Plan and capture 1 per cent share of the world trade by 2007.
"A 1 per cent share would be a great achievement for India, especially if one were to factor in the recent downturn in global trade and conditions of economic slowdown in various developed markets,'' he said.
Mr Maran, who announced a slew of exporter-friendly policy initiatives in the Exim policy, also indicated that the growth rates in February and March would not match the 18 per cent growth achieved in January (on a month-to-month basis). "I will be very happy if our export growth rates in February and March are not negative,'' he said.
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