| What
exactly are your goals through this strategy?
Presently Indian exports
total US$ 44 billion a year. Nevertheless, our
contribution to world exports is less than one percent.
Over the next five years world exports are expected to
reach US$ 7.5 trillion. If India was to
contribute still only one percent this would be
US$ 75 billion dollars. This is not a
difficult target to achieve. But you need to emphasize
exports to achieve that export target.
How does this operate in
practice?
We have identified areas
that have the potential for export keeping in mind
gainful employment and the gainful use of farmland.
There are several areas, there are products and there
are thrust countries. Even 25 years ago, we chose the
information sector. The reasons were obvious. We had the
skilled manpower. Very little investment was required
for infrastructure. All you needed was a computer. Your
stock in trade was your own brain. Of course there were
other facets to this effort. We had to reduce the
customs duty on hardware.
What other areas would
you highlight as meeting your requirements for improving
workers' earning power and capitalizing on India's
farmland?
The other areas include
jewelry, where crafts work is required. There are
several areas of agro-based industries -- fruit, for
example. Today, we don't need to import food to feed our
own population. Other areas where manpower is required
include cotton textiles, garments, and pharmaceuticals.
Is this cooperation
between government and industry a solely sector-based
focus?
Today we in India are
working very closely on drawing up export strategies,
not only for countries but also for products that have a
chance through SMEs, because nearly 40 percent of
India's production is based on SMEs. Directly or
indirectly, SMEs contribute nearly 45 percent of our
total exports.
You also make great use
of industry membership associations…
There are close to a
dozen export promotion councils and others, numbering
almost 20, involved in export activities. Through their
members these councils disseminate information, they
have overseas offices, they have manpower, and they have
knowledge. Trade people are involved in disseminating
information to our members or to the council at a
comparatively inexpensive price.
The job of these councils
has been to explore new markets, look into the various
stages involved in production, and guide exporters on
what to do in what country, whether pricing, quality, or
delivery.
India's membership of the
World Trade Organization -- with its demand for reduced
duties and liberalization of the import regime -- must
have hurt sectors of industry. What has been the impact?
A lot of areas have had
to be vacated by industry because they are not
competitive against imports. I am not only referring to
engineering or consumer products. In certain imports of
food, particularly items like flour, chips cola, ice
cream products, or apples from New Zealand, we are no
longer competitive in price. China for example is
exporting lightweight bicycles that can be folded and
made of aluminum instead of steel. A similar situation
has happened in the fan industry, where imports sell for
50 percent of the price of local manufacturers.
And what has been the
response?
In India many companies
are now shifting to a trading activity, for example in
bicycles. I think there will be a shift into labour-intensive
items, improved productivity and a change in labour laws
(which is already taking place).
What then would you say
is the role of the trade promotion body in this
situation?
The trade support
institution has to look at production to see how it can
be made more economical, to see how to bring in
technology to avoid high-cost processes, find equipment
for that purpose, or how to make components for ultimate
export.
The Indian worker is a
very hard worker but we must all -- in government and
industry -- try to work together rather than
individually. I think this is essential for us to
compete effectively on today's world market. |
