ARUN JAITLEY INITIATES PRE-EXIM POLICY INTERACTION WITH
SERVICES SECTOR
In the first-ever
pre-Exim Policy consultation initiative with a focus on the services
sector, Shri Arun Jaitley, Union Minister of Commerce & Industry
and Law & Justice, met members of Confederation of Indian
Industry (CIII) for obtaining inputs for the forthcoming Exim
Policy (2003-04) to be announced on 31st March, 2003.
Shri Jaitley said that in order to accelerate export growth, there
was need to identify some key areas, which would act as engines
of growth. While he had plenty of procedural suggestions from
exporters, he hoped to get the bigger picture from the gathering
of CEOs. Participants included CEOs representing a wide spectrum
of the Indian services industry, besides other major export sectors.
Shri Vidyasagar Rao, Minister of State for Commerce & Industry;
Shri Dipak Chatterjee, Commmerce Secretary and Shri Lalit Mansingh,
Director General of Foreign Trade also attended the meeting along
with other senior officials.
Presentations were
made by CII members on a wide range of sectors, ranging from
agriculture and food processing, entertainment and media, telecom
and IT services, healthcare, engineering consultancy and education,
among services and textiles, auto components and IT hardware in
manufacturing. Industry representatives present at the meeting
included Mr. Y.C. Deveshwar, Chairman, ITC, Mr. M.K. Sharma, Vice
Chairman, Hindustan Lever Ltd., Mr. Aroon Purie, Editor-in-Chief,
Living Media (India) Ltd., Mr. Shekhar Kapur, Film Producer and
Director, Mr. Mohan Das Pai, CFO, Infosys Technologies, Mr. Kiran
Karnik, President, NASSCOM, Mr. D.S. Brar, CEO, Ranbaxy, Dr. Naresh
Trehan, Executive Director, Escorts Heart Institute and Research
Centre and Ms. Sunita Reddy, Director (Finance), Apollo Hospitals.
Shri Hari Bhartia,
on behalf of CII, listing out of 10 key suggestions said that
the policy benefits of Special Economic Zones (SEZs) needed to
be spread across the country by introducing the concept of virtual
SEZs. This point was later also taken up by Shri D.S. Brar, who
said that the domain knowledge developed in the existing pharma
manufacturing units could not be transferred to a new unit located
in a far-away SEZ and hence the need for virtual SEZs for this
sector.
Pointing out the
enormous potential of the Indian entertainment and media industry,
Shri Shekhar Kapur said that export of Indian films would also
help promote Indian culture and Indian tourism. Fresh infusion
of funds needed to be encouraged by giving tax breaks to corporations
and high networth individuals who want to invest in media. India
should also sign treaties with countries such as Canada, Australia
and UK, to enable non-resident Indians who were willing to fund
Indian films get tax breaks in their countries of residence. Shri
Aroon Purie emphasised that India could become a broadcasting
and publishing hub for the region. For this, all restrictions
on uplinking should be removed, so that content could be produced
in India and exported. In the music industry, piracy was mentioned
as the biggest threat and the government urged to step up its
efforts to protect intellectual property rights.
In healthcare
services, Shri Naresh Trehan highlighted India’s success in
stopping the outflow of patients and even in attracting patients
from neighbouring countries. With the cost of healthcare escalating
in developed countries, India could hope to become a hub for the
provision of good quality healthcare at low cost. In addition
to the steps taken in this year’s budget, the healthcare industry
should be granted infrastructure status, he urged along with Ms.
Sunita Reddy.
The IT services
industry, represented by Shri Mohan Das Pai, made two sets of
demands: first some suggestions on India’s economic diplomacy
and second related to specific benefits given to the sector. India
should constantly lobby to lift visa restrictions and try to enter
totalisation agreements with developed countries which would enable
IT workers to save on tax payments. The industry urged the abolition
of custom bonding scheme; export obligation being imposed on companies
rather than on units and the ability to transfer tax exemptions
to sub-contractors.
Shri Kaul, Director
(Commercial), Engineers India Limited highlighting the problems
faced in project exports in sectors such as telecom and
engineering, said that the clearance process when bidding for
large projects should be quicker. Currently, commercial banks
can clear projects only upto Rs 5 crore, whereas project size
for exports were normally to the tune of Rs 100 crore. Project
exporters should also have access to soft loans.
The presentation
on agriculture and food processing by Shri Y.C. Deveshwar
emphasised the need to promote the competitiveness of the Indian
farmer. Specifically, the recommendation was to give tax breaks
on investment in agriculture against a commitment on future exports.
Shri M.K. Sharma suggested other measures for promoting Indian
processed food exports including the reform of Indian food laws,
availability of refrigeration infrastructure at ports, government
support for tea and marine exports and reduction in power tariffs.
Concluding the session,
Shri Tarun Das, Director General/CII, stressed that SEZs needed
to be strengthened, the industrial clusters throughout the country
should be incentivised to encourage exports and the India brand
should be promoted aggressively.
