Explore new markets to boost engineering exports: Rajeev Kher

NEW DELHI: The Commerce Ministry today asked engineering sector exporters to focus more on improving standards and qualities of products besides exploring new markets to boost shipments.
Expressing "shock" over steep decline in engineering exports, Commerce Secretary Rajeev Kher said exporters should explore regions such as Latin America, Africa and Commonwealth of Independent States.

The exports entered into negative zone in October. It declined by about 10 per cent to $ 5.21 billion last month.

As the sector contributes over 20 per cent of the country's total exports, the overall outbound shipments in October dipped by five per cent year-on-year to $ 26 billion.

"I really felt shocked that engineering exports are in negative. Engineering and pharma are our two flagship sectors. We always felt confident that these sectors can't go wrong," Kher said.

He further said that western markets, including the EU and Japan, are not improving.

"The new foreign trade policy will clearly acknowledge the fact that growth in various regions are asymmetric," Kher said.

The Secretary said moving up the global value chain and standards are the main challenges for the sector.

Exporters should focus more on standards and quality of products and Engineering Export Promotion Council (EEPC) should work in this direction, he added.

Further, he said that liberalisation of foreign direct investment policy in defence would throw huge opportunities and market for the sector.

Meanwhile, EEPC said it has prepared a strategy paper for the sector which suggested various ways to boost shipments.

The council said exports may hover in the range of $ 86 billion to $ 125 billion by 2018-19.

The paper suggested to focus more on markets such as Africa and work on improving competitiveness to enhance exports.

"Trade agreements may be put in place with attractive markets like Southern and Northern Africa and Gulf countries. Invest in leading SMEs globally to create a foothold in innovation. Build engineering SEZs closer to ports and create ecosystem to attract global manufacturing firms," it said.