29.5 percent cumulative export growth in India between April-Dec 2010-11 (Part II)

February 25th, 2011 - 5:20 pm ICT by ANI  

(Cont.)

According to the Survey, the revival of this sector is a good sign, though it is partially due to the base effect. The falling services trade surplus however is adding to the problems on the current account deficit front, instead of acting as a cushion as was the case earlier.
The Survey states that the Trade policy measures taken by the Government and the RBI in 2009-10 and 2010-11 focused on reviving exports and export-related employment besides mitigating the effect of inflation.

The Government followed a mix of policy measures including fiscal incentives, institutional changes, procedural rationalization, enhanced market access across the world, and diversification of export markets.

Exports of SEZs during the first three quarters of the current year have been Rupees 2,23,132.31 crore.

Out of the total employment of 6,44,073 persons in SEZs, an incremental employment of 5,09,369 persons was generated after February 2006 when the SEZ Act came into force.

Some issues related to SEZs include the deadlines under the Direct Tax Code (DTC), goods and services tax (GST)-related issues, coordination issues, and privatization of Government SEZs, adds the Survey.

The trade growth in emerging and developing economies is expected to be more than that of advanced economies in 2011 and 2012.

The outlook for India’s trade sector has brightened with a growth of 29.5 per cent in 2010-11 (April-December) and a growth of 36.4 per cent in December 2010.

However, this needs to be moderated on account of the recent developments in world trade, though transient in nature at present, like the financial turbulence in the periphery of the euro- zone and the new disturbances in the Middle East resulting in oil prices (Brent) crossing the 100 US dollar mark.

There is also a need to guard against new protectionist measures. Though, many of these are on the decline, those already in place need early winding up.

While the potential for India in trade is great, the challenges are also plenty, says the Economic Survey. (ANI)

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