India Inc raises concerns over FTAs, imports with ComMin

Will look into demand regarding inverted duty structure, says Sitharaman.

Nirmala Sitharaman

Ahead of the Budget and amid continuing slowdown in exports, commerce and industry minister Nirmala Sitharaman on Wednesday met India Inc to discuss issues including impact of free-trade agreements (FTAs) signed by India, ways to promote start-ups and boost economic growth.

“We had a detailed discussion on the industry, investment and understood the situation that is prevailing, the industry’s mind about what is happening in the Indian economy today and also from their perspective what is it that government can do or the states can do towards improving situation,” Sitharaman said after the meeting.

The minister assured the industry of looking into their demand on inverted duty

structure in few sectors which are impacting domestic manufacturing. During the meeting concerns were raised by industry chambers over FTAs that India has signed with countries including Japan, Singapore, and South Korea among others. they said that these agreements benefited the partner nations more.

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CII president-designate Naushad Forbes, who attended the meeting, said that there is a need to ensure and look at ways on “how do we turn FTAs to the advantage of Indian industry”.

Ficci suggested a review of existing FTAs before signing of new ones. It said that in many cases, domestic input cost increase is impacting cost of manufacturing but selling price linked to cost of imports leading to erosion of industry’s pricing power and squeeze in margins to uneconomic levels.

Further, on start-ups, Forbes said that there is a need to remove regulatory burden for such firms which are below a certain threshold limit, say less than Rs 5 crore capital and make it more attractive.

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Former Ficci president Harsh Pati Singhania said that the key issues which are discussed include ways to increase growth rate and investments.

An official said that the minister also asked the industry to become more competitive while allaying apprehensions about the 12-nation Trans-Pacific Partnership (TPP) trade deal. She said that India is focusing on countries including Cambodia, Laos, Myanmar and Vietnam to boost demand.

The official added that presentations were made on start-ups, Make in India and trade scenario to the chambers.

Seeking clarity on the e-commerce sector, the industry also pitched for allowing 100 per cent FDI in multi-brand retail in segments such as electronics, apparels and fresh food product.