Commerce and Industry Minister Anand Sharma will unveil the current UPA government’s first foreign trade policy on Thursday to address embattled exporters waiting for government support to stay afloat amid shrinking world demand.
India’s exports contracted for the ninth successive month plunging by 27.7 per cent in June.
“The policy will be forward looking, taking on board the concerns of the industry, particularly the labour-intensive sectors. They will get special attention,” Sharma said at a seminar on Wednesday.
The government is keen on diversifying the export destination to new areas away from the traditional markets of the USA and European Union (EU).
At present, over 55 per cent of India's $168 billion exports are destined for the two high growth regions.
“I have directed my team to prepare a strategy paper for Africa and Latin America," Sharma said
Shrinking world demand has affected India’s handicrafts, gems and jewellery, leather and textile exports severely during the current financial year.
In this year’s budget presented about a month ago, a worried government had announced some measures, including extension of an existing subsidised bank loan scheme and widened the list of tax-free services to aid exporters.
The President of Federation of Indian Chambers of Commerce and Industry (FICCI) Harsh Pati Singhania termed the fall in exports as “disturbing.”
“It is imperative that the forthcoming foreign trade policy addresses exporters’ difficulties effectively and the momentum in export growth be restored,” Singhania said.
International rating agency Moody’s says exports are likely to revive later this year.
“As global prospects are now improving, especially with the US economic contraction easing, India's exports may begin to recover later in the year,” Moody's said last month.