It is good news for India’s trade as exports of merchandise goods surged a record high in the first quarter of 2021 standing at $95.36 Bn. This trend of consistent positive growth is sure to do good for the Indian economy. India’s initiative to promote FTAs ( Free Trade Agreements ) with the major trading partners will set the momentum to boost exports and attract Foreign Investments. The Ministry of Commerce shall start the consultative process in July for the FTA with the UK and the EU.

Export Promotion Councils

Export promotion councils to play a prominent role in identifying sensitive items that are to be protected as well as those which needs to have greater market access in the UK and the EU.

Indian Textile Industry

Inspite of having to face stiff competition from Bangladesh and Vietnam, the Indian Textile industry is confident to gain access into the UK markets if the government can revisit schemes for lowering of duties. And if things go well, trade between the two countries would be doubled by 2030.

Strong demand for engineering goods

There has been a strong demand for auto components, hand tools and medical devices from Europe, USA, Saudi Arabia and the UAE. However, increasing Freight rates and shortage of shipping containers have poised a major challenge to exporters in catering to this demand. The Executive Director of the EEPC (Engineering Export Promotion Council) have expressed their serious concern over the matter.

Top exporter of Prawns to USA

India tops the list of prawn exports to USA with 2.7 Lakh tonnes.

Block Train from Finland to India

The first consignment of 32 FEU’s of a  Swedish based company’s paper based products was shipped on a block train using a new transport corridor linking Europe and India. The corridor is a 7,200-km multi modal network that can be used to move freight between India, Russia, Azerbaijan, Iran, Europe and Central Asia with the added benefit of improved transit time and cost reduction in transportation.The transit time from the place of receipt – Vuosaari in Finland to Jawaharlal Nehru Port in Mumbai is around 25 days.

Stiff Competition from Africa for Tea exports

Africa’s lower freight rates has prompted them to offer highly competitive prices for tea in the international markets. This is an alarming situation for tea exporters in India, where the freight rates have increased four folds this year. This apart, higher tea prices and lower production in tea producing states like Assam due to crop loss are also other factors that are effecting tea exports.

Opportunity for Rice Mills

There has been a massive increase in China’s purchase of rice from India. China mainly purchases the non-basmati rice. As of now, only 24 mills have been approved to export rice from India. The Directorate of Plant Protection Quarantine and Storage has written to the Agricultural ministry to take up the matter with the Chinese Authorities in allowing rice shipments from the remaining 55 mills to enhance the quantum of Indian exports.

Export Insurance coverage to increase

Export Credit Guarantee Corporation promotes exports by providing credit insurance services.

The government has decided to infuse equity in ECGC and provide additional corpus to the National Export Insurance Account (NEIA) for the next five years. Exporters say that this shall greatly help to ease the liquidity crunch and mitigate risks.

MOOWR – New Warehouse scheme

The MOOWR scheme is a big step towards Make in India elevation. The most prominent feature would be that it is delinked to the export obligation and the benefit is also extended to the importers who import for domestic consumption. Some of the key benefits of the scheme are the deferment of import duty on capital goods and raw materials. Customs duty shall not applicable if the goods are exported from the bonded warehouse and no interest on storage of the goods till the time they are utilized for manufacturing.

Freight Smart Cities

The Commerce Ministry unveiled plans for freight smart cities to improve urban freight efficiency and reduce logistics costs. City level logistics committees with related government departments at the local and state levels shall be formed. Private sector Logistics services companies and its users would also be part of these bodies.

Inclusion of Retail and Wholesale Trade as MSMEs

Reinstating wholesale and retail in this category will help in the formalisation of the sector as well as making entities eligible for priority sector funding and special liquidity schemes from banks. The move is set to benefit 2.5 crore enterprises.

Draft e-commerce Rules

The proposed rules have been in direct contrast to the FDI policy changes for e commerce business, which came into effect in February 2019. The FDI rules, allow foreign e commerce marketplaces to sell through affiliated sellers but limiting their stakes to 25 per cent in the joint venture company. It also classifies these platforms as intermediaries and are not directly responsible for transactions between sellers and customers on the platform. In contrast, the draft rule asks e-commerce marketplaces to not sell the goods of related parties on its own platform.