Where to now, Mr. Minister?
The dust has settled on the General Elections to choose members of the 17th Lok Sabha, and Narendra Modi’s NDA government is all set to take charge of India for the next five years. With the new cabinet sworn in this week, all eyes will be on the government’s key announcements in the coming 100 days. Exporters and traders, in particular, will be keenly looking to Mr. Piyush Goyal, the new Minister of Commerce and Industry, and Mr. Nitin Gadkari, the new Minister of Micro, Small and Medium Enterprises, for guidance on future steps.
The challenges facing the Commerce Ministry, in particular, are big ones, with rising protectionism and slowing growth key global issues to tackle. Boosting exports and resolving trade issues at the WTO are likely to be on top of the new Ministry’s agenda in the coming months. Towards this end, this week has already seen two major policy announcements -- a new draft export policy, and proposed policy for promoting exports through ecommerce. With industry expectations for positive reform running high, exporters will hope that the new Ministers will make solving their credit access and business growth issues a priority.
The US-China trade war is heating up, with both sides looking set on a collision course. There is an opportunity in this global crisis too if India is able to leverage its capabilities and plug the right gaps. The economy is now in the hands of the new Ministers -- where we go from here depends on them. India’s exporters can only wait with crossed fingers and bated breath.
Road ahead for the Commerce ministry: Boosting exports, resolving trade issues key focus areas
The commerce ministry has its work cut out in the coming months, with issues such as a subdued outlook by the World Trade Organisation (WTO) on global trade, a widened trade deficit and a multitude of challenges on the bilateral and multilateral fronts confronting the new Narendra Modi government. A downward slide in Foreign Direct Investment inflows and flagging merchandise exports are other areas of concern.
Draft export policy unveiled
The Commerce Ministry has come out with a comprehensive draft of the export policy which includes product-specific rules with a view to provide a ready reckoner for exporters. “Based on inputs received from various partner government agencies, it is proposed to bring out a comprehensive exports policy for all ITC (HS) tariff codes (including items which are ‘free’ for export and do not currently exist in the policy), covering conditions/restrictions imposed by partner government agencies on exports,” the Directorate General of Foreign Trade said.
Export promotion via ecommerce on the cards
The Department for Promotion of Industry and Internal Trade (DPIIT) will come out with a strategy to promote exports through ecommerce, detailing the role of the Reserve Bank of India, India Post, customs authorities and export promotion councils. A Parcel Directorate for ecommerce packages, standardization of PIN codes and integration of India Post tracking with foreign postal systems are some of the initiatives the government is considering to boost exports through ecommerce.
Building on Wilbur Ross's recent visit, USTR delegation may meet Commerce Ministry officials next week
Representatives from the office of the United States Trade Representative (USTR) are expected to meet India’s Commerce Ministry officials next week to take stock of the progress made on the discussion held earlier this month with US Commerce Secretary Wilbur Ross. “Continuing the ongoing process of discussions and talks, USTR officials are expected to come down next week to take forward the talks held last week,” a senior government official told Moneycontrol.
Regulator’s proposed sandbox norms might be restrictive, says law firm
Leading law firm Cyril Amarchand Mangaldas has said that while Indian regulators have been swift in adopting the global trend related to a regulatory sandbox, the recent proposed guidelines by the Securities and Exchange Board of India may prove restrictive in nature with the results not being fully accurate due to the framework as put forth in the discussion paper. The capital market regulator, on 28th May, released a discussion paper on the proposed framework for a regulatory sandbox that essentially provides a testing platform for new technologies and products for the capital market by SEBI-registered market participants in the initial stage and fintech startups at a later stage.