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India should seek urgent GSP renewal from US: EEPC India

KOLKATA: EEPC India, representing one of the largest contributors to the country's exports basket, has said the Indian government should immediately seek renewal of the GSP (Generalised System of Preference)under which exports to that country get concessional duty treatment. 

The presentation made by th the EEPC India (formerly Engineering Exports Promotion Council) at the meeting of the Board of Trade Chaired by Mr Anand Sharma, the Union Minister for Commerce & Industry Chaired held on 27 thAugust 2013 to exchange concerns of the trade with members of BOT to devise measure to boost exports thereof. 

A major announcement made by CIM was to set up a Task Force on Currency Swap Arrangements and Agreements to suggest a possible mechanism to address the rising trade deficit and consequent current account deficit. EEPC INDIA is a member of newly constituted an important Task Force with other organisations Besides, according to this presentation made by Chairman, EEPC India, Mr Aman Chadha , India's engineering exports to 
USA has fallen by nearly 14 per cent from $2.18 billion in April-July 2012 to $1.89 billion during April-July 2013. Further, the US GSP scheme has expired on July 31, 2013. 

"The Government must request the 
US Government to extend the GSP scheme at the earliest as otherwise our exports to the US are likely to be hit considerably," the EEPC India said. 

It also said that the major worry both from the USA and the European Union are now targeting Indian engineering goods."Earlier, raw materials like Stainless Steel bars and wires were targeted.Now finished products like threaded rods are being also investigated. We must also try to counter this by restricting imports of these countries or at least investigating the exports of their products to India," it said. 

Yet another suggestion from EEPC India is that both 
Africa and the South East Asia hold good potential for exports even though shipments to these regions, especially Africa, have dropped considerably. 

"Both Africa and South East Asian countries have good potential for export of machineries and Project Exports. However, we find that 
funding is an important issue, especially in Africa. Though Exim Bank's Lines of Credits are available for African countries, the interest ratesare very high, whereas, our competitors from China and other countries are able to offer cheaper financing for a longer period resulting into loss of orders". 

EEPC Chairman suggested that for Africa, the governments'lines of credit should be offered at a cheaper rate so that "we are able to convert many enquiries into orders". Further, financing under National Exports 
Insurance Account (NEIA) routed through the EXIM Bank is available only to Govt. buyers or a company where the respective Govt. has a stake in that company. We suggest that this should be made available to all categories. 

Exports to Africa have declined 7.71 per cent between April-July this fiscal. Also the entire
ASEAN region should be brought under FMS since China enjoys zero duty benefit for many engineering products whereas India benefits only from a phased out preferential duty benefit. Further, this will also help us compete with Thai and Malaysian exporters, the EEPC India Chief said.