Government may consider e-platform to enable small-scale manufacturers to find overseas buyers.

NEW DELHI: In order to boost exports, government could consider an e-commerce platform to enable small-scale manufacturers to find overseas buyers.

The five-year foreign trade policy (FTP) 2014-19,which will be announced after the new government takes over, could also look at ways to give a thrust to services exports, and go big on 'Made in India' branding initiatives. "We are exploring to push exports through an e-commerce platform. It has its complexities, but we will try to work that out. This will definitely open up avenues for small exporters and manufacturers," said a commerce department official.

India's outbound shipments touched $312 billion in 2013-14, registering a 3.96% growth over the previous fiscal but missed the annual target of $325 billion for the second straight year. Exports fell slightly short of the $330 billion estimated during the five-year period.

The government is also open to considering a long-term export target as suggested by the apex exporter's body FIEO.

In its presentation to the government, FIEO has recommended a target of $750 billion exports by 2018-19. "Rather than setting annual targets, it is a better idea to work on a long-term export target while having mid-term sectoral trade reviews," the official said.

FIEO has also recommended the use of e-commerce platform, which can be used both for business-to-business and business-to-customer transactions.

"There will be a need to define e-commerce-led retail exports in the FTP. These must be exempted from VAT, CST and also be allowed duty drawback and other export benefits," said FIEO director-general Ajay Sahai.

The worldwide e-commerce sale has reached over $960 billion, growing at nearly 20%.

The FTP is also expected to include identification of markets, providing branding assistance, assessing need for a free trade agreement with a particular country or a specific package for exporting high-value products to countries such as the US, the official said.

Indian exports clocked a compounded annual growth rate of 17.2% between 2003-04 and 2013-14. However, the compounded annual growth rate came down to 11.01% between 2008-09 and 2013-14, FIEO noted in its report.

The other items on the policy could be adoption of higher standards, promotion of currency trading and services exports.

"In the current FTP, there is no focus on the services sector. When we are earning $148 billion from services exports, there is no reason why there shouldn't be special incentives for services exports," commerce secretary Rajeev Kher had told ET on an earlier occasion.

FIEO has suggested an extension of the 3% interest subvention scheme to the services exports sector for MSMEs (micro, small and medium enterprises) to begin with. Services exports have just one scheme at present - Served From India Scheme - where service providers are entitled for a duty credit scrip.

FIEO has also recommended creation of an export development fund with a corpus of a minimum 0.5-1% of the preceding year's exports. In order to replenish the fund, FIEO has suggested a cess of 0.25-0.5% of exports on raw material exports, with a similar contribution by the government.

Source : economictimes.indiatimes.com