Guest Column

True that India's export growth leaped to 21.65 per cent for the month of October 1999. With this performance, one can expect an export gr...

True that India8217;s export growth leaped to 21.65 per cent for the month of October 1999. With this performance, one can expect an export growth of 10 per cent for the year ended March 2000. But is this enough? Definitely not.

We need to export more and get more value from the goods we export. Good marketing abroad, packaging and better relationship with overseas clients are not enough.While other countries like China and South-East Asian countries are earning billions of dollars in exports by multiplying their export earnings, India is comparatively making only a slow progress. Much more needs to be done by India. We could have earned more money from exports if transaction costs in India are reduced. As of now, high transaction costs like sales tax, inter-state tax, octroi, turnover tax etc are acting as drags on exports. The cascading effect of all such levies has cut into the margins of exporters. Not only that, China and other South-East Asian countries are giving tough competition to our exporters astheir transaction costs are very low when compared to India.

Finance Minister Yashwant Sinha had assured in the last Budget that the government would look into the high transaction costs and set up a committee. However, nothing has happened. One can hope that Sinha will take measures in the forthcoming Budget.The second major aspect that needs to be tackled is the considerable delay in getting necessary clearances.

We lose precious time dealing with bankers, customs offices, excise, Director General of Foreign Trade DGFT, octroi and so on. All these offices should be connected through a computer network so that exporters8217; work is minimised. Everybody will benefit from achieving computer inter-connectivity. This is very essential and it will improve efficiency, faster shipment and save precious time and energy of exporters and even government officials.The government, bankers, customs and exporters should work closely so that exports can be boosted. The country needs precious foreign exchange. We needmore expansion of our infrastructure areas.

Port, roads and power generation need to be expanded and modernised. This will ensure faster clearance of cargo. Thirdly, there is an urgent need for reforms in labour policies. It is necessary that old labour laws are changed and forward-looking policies are introduced. We need to have higher standards of productivity, education and efficiency in the labour force.

Reforms have improved conditions in various industries. Industries like automobiles, steel and cement are cases in point. Today, its a buyer8217;s market and quality has become of paramount importance. There is a range of products the buyer can choose from. Our policy-makers need to push for strong reforms, cut red-tapes and bring new labour laws. If the government modernises the judicial set-up, our performance will definitely get a boost.

Our judicial system needs to be computerised and modern facilities should introduced. Reforms in areas connected with exports will change the scenariocompletely.Growth in exports has been quite erratic in the last few years. The Commerce Ministry had fixed a target of 20 per cent for 1999, but exports fell by 4 per cent in the year. Estimates for the current fiscal range around 10 per cent. The export growth in 2000 is likely to be better than that in 1999 for the simple reason that exports growth was negative last year. We need to look much beyond 10 per cent growth. Many countries in Asia, which were behind India in exports till two decades ago, have gone ahead of us. We need to overtake them.

The author is the Chairman of Chemexcil