Industry & Economy
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Industry Associations
`Rationalisation of procedures has cut transaction costs'
Our Bureau
New Delhi
,
April 6
ON account of rationalisation of complex procedures by the Ministry of Commerce and Industry, the transaction costs for textiles, garments, engineering, pharmaceuticals, computer software and chemicals have decreased since 2000, the Associated Chambers of Commerce and Industry (Assocham) has said.
"Simplification of procedures in the last four years have by and large resulted in reduced transaction costs barring few exceptions," Assocham said.
As per the chamber's findings, the maximum cost in terms of present export revenue particularly in the textile/garment sector, engineering goods, pharmaceuticals have come down to 10 per cent, 5 per cent and 8 per cent, respectively in 2004 from 15 per cent, 10 per cent and 10 per cent in 2000, the chamber President, Mr Mahendra K. Sanghi, said in a release.
Textiles and garments are one of the major items in exports, accounting for as much as 23.25 per cent of the country's aggregate exports by the end of 2004, it said.
In case of chemicals, while the transaction cost as percentage of export revenue was 14 per cent in 1998, it fell to 5 per cent by the end of 2004. As regards to computer software, the cost came down heavily from 10 per cent to less than 2 per cent, Mr Sanghi said. The agro-industry is another sector where the transaction cost has slipped from 7.5 per cent in the year to less than 2 per cent.
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