New Delhi, Dec. 11: The government plans to announce incentives to boost exports this week as merchandise shipments abroad contracted for the seventh month in a row in November to $22.3 billion.
Imports, however, grew 6.35 per cent to $41.5 billion in November, leaving a trade deficit of $19.28 billion. During the April-November period this fiscal, the country’s shipments have shrunk 5.95 per cent to $189.2 billion, resulting in a ballooning trade deficit of $129.5 billion.
“The incentive package will come hopefully by the end of the week. We are waiting for a final confirmation from the ministry of finance. We are trying to look at how to give a fillip to sectors that contribute most to export performance,” commerce secretary S.R. Rao said.
He also hoped that in the last quarter of the fiscal (January-March), exports will pick up. However, Rao said the depressing trade environment had made the export target of $360 billion difficult to achieve.
The stimulus to be announced will be the government’s second such move this year to help exporters weather the demand slowdown. In June, it had announced a package mainly for small businesses who are usually hit the hardest.
Rafeeque Ahmed, president, Federation of Indian Export Organisations, said “With the slowdown in global trade, pricing has become a key issue and extension of some fiscal benefit by the government will help the exporters to factor the same in their prices to procure such orders.”
Director General of Foreign Trade Anup Pujari said four of the top five exporting sectors had registered negative growth during April-November 2012. These are engineering, petroleum products, gems and jewellery and readymade garments. Only pharmaceuticals exports have recorded positive growth during the period.