Budget 2019 India: The global exports via e-commerce is an annual market opportunity of $450 billion. This includes all goods that are directly sold to a consumer from a seller located outside their country and the order is placed via the internet. Currently, around 75,000 sellers or exporters are able to retail their goods via e-commerce.
To put things in perspective, out of this $450 billion available e-commerce exports opportunity, India did a meagre $1.2 billion in 2018-19. The reasons for India’s low share in this fast-growing market are multiple but thankfully none that can’t be addressed if taken up in mission mode with a great sense of urgency.
E-commerce exports have the potential to be grown by a magnitude of 10 in the coming five years translating into $12 billion worth e-commerce exports by 2024. This 10X growth can be achieved by growing volumes in the existing and new categories that contribute maximum to e-commerce exports such as home décor and furnishings, medicinal and Ayush products, apparels and textiles, beauty and cosmetics, office and stationery products, leather, handloom and handicraft, gems & jewellery, and toys & sporting goods. In order to achieve this 10x growth, focus on the following areas in this year’s budget is important.
RBI should permit inward remittance of around 50 per cent of invoice value at the time of export, thereby allowing exporters the flexibility to sell goods at a premium based on product demand or at a lower price in case of stock liquidation.
RBI should also permit the realisation of exports proceeds up to a period of 24 months from the date of export.
A mission mode project should be launched with deep engagement with EPCs and exporters participation in the identified categories mentioned above.
The government should set up an E-commerce Exports Center of Excellence that enables exporters to quickly get onboard on e-commerce for selling their products.
Roll out of an e-commerce exports service by India Post that provides Business to Consumer international speed post delivery times at one-third of the current prices. The product must entail a shipment pick up service, post offices in top 50 exporting districts having a dedicated e-commerce desk staffed with trained personnel and integration with APIs of the US Post, Royal Mail and other destination countries such that an exporter or a consumer and can track their shipment end to end.
The government should provide subsidies or incentives to exporters for advertising their products by around 50 per cent that would help them grow their exports.
The Ministry of Commerce needs to assume a leadership role and work with the industry and the various government departments like RBI, India Post, CBIC and the various Export Promotion Councils.
The budget should announce e-commerce exports as a priority sector which will give it a major boost. This is one sector which can take Make in India to the next level as we will make more of what we have an expertise in. It will help bring new foreign exchange and create a large number of jobs. If the workers in Moradabad stay in Moradabad and work in an export unit and not have to move to Delhi NCR, it is a great thing.
Source: financialexpress.com