“If we look at the direction of Indian exports, we are able to discern a shifting trend as Indian exports to Asia, Africa and Latin America during 2012-13 touched US$ 195.27 billion, accounting for 65% of our total export basket. This is indeed a development with significant import as South-South trade is assuming a new dynamics,” said Indian Commerce and Industry and Textile Minister Anand Sharma releasing the annual supplement (for 2013-14) to the Foreign Trade Policy 2009-14, here on Thursday.

Value added exports have also assumed a centrality in India’s export basket as engineering exports accounted for $ 57 billion, textiles accounted for $ 26 billion and pharmaceuticals at $ 15 billion.

Norway has been roped in as a new market under the Focus Market Scheme, taking the total number of such markets to 125. Venezuela has been considered for eligibility under the Special Focus Market Scheme with 4% duty credit, taking the total number of countries to 50.

About 47 new items have been added to the Market Linked Focus Product Scheme (MLFPS) and benefits for exports to US and EU for chapter 61 & 62 pertaining to the textile sector, has been extended by another year till March 2014.

Also 126 items of engineering, pharmaceuticals, chemicals and textiles sector to the Focus Product Scheme (FPS) and two new items have been added in the Vishesh Krishi and Gram Udyog Yojana (VKGUY) Scheme. It has been decided to incentivize High Tech Products with effect from June 30, 2013 for which a separate notification would be issued.

The government has decided to extend the period and scope of interest rate subsidy provided under the zero duty Export Promotion Capital Goods (EPCG) scheme to all sectors.

“We have decided not only to extend the zero duty EPCG scheme beyond March 2013, but also merge it with 3% EPCG scheme. Now the zero duty EPCG benefits will be available to all sectors,” Sharma said.

India’s exports dropped by 1.76% at $300.60 billion in the financial year ended March 31, 2013. In the previous financial year the exports had increased by more than 20%.

The country’s trade deficit widened to $190.91 billion in 2012-13 as compared to $183.4 billion recorded in the last fiscal.

India’s garment exporters are facing tough times due to increased competition from Bangladesh and China in the US and European markets.

Sharma said the World Trade Organisation's (WTO) recent report paints a disturbing picture of the global trade in the current year.

WTO in its latest report has revised the global trade growth projections downwards from 3.7 per cent to 2.5 per cent for the current year, which is less than half of the previous 20 years average, the Minister added.

On SEZs the Commerce Minister said : 'We have taken note of the fact that there are acute difficulties in aggregating large tracks of uncultivable land which is vacant and contiguous and we have decided to reduce the minimum land area requirement by half for different categories of SEZs.”

'...there would be no minimum land requirement for setting up IT/ITeS SEZs and only minimum built up area criteria would be needed to be met by SEZ developer,' he said.

On demands of a exit policy for the SEZs, Sharma said it has been decided to allow transfer of ownership and sale of SEZs units.

'I hope that the measures which we have announced today will go a long way in providing much needed support for exports,' Sharma said.
Observing that the government has modified the SEZ policy after comprehensive and year-long consultation with the stake holders, Sharma hoped that the initiatives would 'revive investor interest in SEZs'.

The Minister said that the government will set up the 2nd Task Force to suggest measures for reducing transaction costs and added it will submit its report in six months.

Recommendations of the earlier committee had resulted in reduction of transaction costs, he said, adding, more is needed to be done. Referring to the decline in exports and rising trade deficit, the Minister said that was 'indeed a disturbing trend...it is a matter of concern that trade deficit which was USD 183.4 billion (in 2011-12) has increased to USD 190.1 billion in 2012-13'.