NEW DELHI, Jan 28: The commerce ministry is considering moves to extend the zero duty export promotion capital goods (EPCG) scheme to the engineering sector having a large concentration of small scale units such as bicycles, castings, forgings, hand-tools etc.This is sought to be achieved by lowering the threshold limit of Rs 20 crore (CIF value) for import of new as well as second-hand capital goods under the scheme.
The intention is to raise engineering exports by 20 per cent in dollar terms from $3.941 billion in 1996-97 to around $9.8 billion by the turn of the century, as envisaged in the commerce ministry's strategy. This sector has exhibited an average growth rate of 15 per cent in the past five years.
Detailed market studies are proposed to be taken up in the emerging and important markets to increase exports. Export promotional measures like participation in exhibitions, buyer-seller meets will be conducted by the engineering export promotion council's overseas offices.
A task force will beconstituted in the commerce ministry to identify engineering product groups where India has a long-term comparative advantage vis-a-vis its competitors and recommend a suitable policy package for the government's consideration.
As regards infrastructural problems, coordination with various agencies for removing the bottlenecks, for example, parking, berthing facilities in ports shall be taken up. A new terminal has been commissioned in JNPT, Mumbai, for accommodation of vehicles and the project is expected to be completed in about three years.
Stringent pollution control norms imposed by the Central Pollution Control Board (CPCB) on castings and forgings furnaces have led to closure of a large number of units. A revision of CPCB norms is being pursued, besides requesting the Small Industries Development Bank of India for assistance on liberal terms for technological upgradation.
Engineering exports are a major component of the total export effort and have approximately constituted 11 to 12 per cent ofthe total exports in the last several years.
In 1996-97, engineering exports (excluding management and technical services) constituted 12 per cent of total exports. These exports exhibited a growth of 9.2 per cent over the previous year totalling $3,941 million against $3,607 million in the preceding year.
During April-August 1997, the exports amounted to $1752.29 million, posting a growth of 13.22 per cent in dollar terms over the previous corresponding period.
Viewed in the global context, however, India's engineering exports constitute a negligible percentage of total world trade in engineering products. During 1995, the estimated global trade in engineering goods (excluding electronics and services) was $1,510 billion as per UNCTAD figures. Of this India's share was just 0.24 per cent. However, this was an improvement over India's performance in 1992 when it contributed only 0.18 per cent to the global trade in engineering products.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
