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India says export growth will continue to slow

India says export growth will continue to slow

India cut its export growth projections Thursday and announced tax and other incentives to help companies battle slumping demand in the nation's most important overseas markets, the United States and Europe.
Export growth is expected to slow from 25 percent to 15 percent a year, reaching $200 billion for the year through March 2011, said Commerce Minister Anand Sharma. For the fiscal year through March 2009, exports totaled $168 billion.
"This year we are witnessing one of the most severe global recessions in the postwar period," Sharma said in a prepared statement announcing the new government's five-year foreign trade policy.
"Fortunately India has not been affected to the same extent as other economies of the world," he said.
While India has been more insulated from the downturn than its more export-dependent neighbors, export-oriented sectors like garments, information technology, and diamonds have been hit hard by ten months of declining exports.
The ministry extended some export tax refunds through 2011 and agreed to waive import duties on capital goods for technology upgrades for some companies.
Sharma also said the government would encourage Indian companies to export more to Latin America, Africa, Oceania and Eastern Europe, by helping to offset the elevated credit risk and high trade costs associated with those emerging markets.
Sharma said the government would like to double India's share of global trade by 2020. In 2008, India accounted for just 1.45 percent of global merchandise trade and 2.8 percent of commercial services exports, the ministry said.
World trade is expected to contract by about 10 percent this year, according to World Trade Organization and International Monetary Fund projections.
Sharma said growing protectionism has exacerbated that slowdown and said India remains committed to moving forward with multilateral trade negotiations under the Doha round.
"We are in favor of establishing a rule based, fair and equitable global multilateral trading regime which has development as its core objective," he said.
India recently signed bilateral free trade deals with South Korea and the Association of Southeast Asian Nations, or ASEAN, but WTO talks fell apart last year, after India, China and the United States failed to agree on terms that would allow poor countries to boost tariffs to protect domestic farmers in the event of surging farm imports.


Updated : 2021-06-13 21:51 GMT+08:00