New Delhi, July 6 (FN Bureau) Pursuing new free trade agreements (FTAs) with emerging countries in Latin America and Africa, a scheme to support MSMEs in research and innovation, setting up a domestic shipping line, and global branding of Indian products are among the key suggestions in a strategy paper prepared by EEPC India to boost engineering exports and achieve the target of US$ 300 billion by 2030. In a meeting called by the Ministry of Commerce & Industry this week, EEPC India Chairman Arun Kumar Garodia discussed various recommendations in the strategy paper to boost India’s engineering exports. Union Minister for Commerce and Industry Minister Piyush Goyal chaired the meeting , the EEPC India chairman said on Thursday. The strategy paper calls for greater market access especially in Africa and Latin America as they have the potential to become significant export markets for India.
It has been noted that by expanding into non-traditional markets, the risk associated with economic uncertainties can be spread out, reducing dependence on a few markets. Talking about the strategy paper, Garodia said that there are around 40 countries that currently account for over 87 percent of India’s engineering exports. Therefore there is a huge opportunity to explore new markets while expanding the existing base. “It is quite crucial for India to explore new markets, especially in Latin American and African countries. Many of our competitors have already established FTAs with these countries and as a result, are having a competitive edge over us. FTAs with these countries can level the playing field, ensure fair market access and expand our exports,” Garodia said. He said that given the current global economic trends, the world economy is expected to slow down this financial year and will impact engineering exports from India as seen in the past several months.
Among measures to expand the current market base, he suggested strengthening presence in Europe as a priority by implementing an FTA with the EU. Highlighting the importance of the engineering sector, Garodia said that the industry accounts for 25 pc of the country’s total exports and is the largest foreign exchange earner. Notably, MSMEs account for 35-40 pc of total engineering exports and therefore are crucial job providers. The strategy paper has highlighted that most MSMEs face financial constraints and struggle to secure investments. It has recommended implementing an aggressive “SME Assistance Programme” to support research and innovation in the MSME sector. On the need for establishing a domestic shipping line, Garodia said that it would reduce trade costs, decrease dependence on foreign shipping lines and save huge amounts of valuable forex. He added that dedicated efforts in branding and marketing were essential for success in specific product categories and markets.