Board of Trade to meet on Tue to discuss ways to boost exports

New Delhi, Nov 24 (PTI) Issues pertaining to quality control orders and the proposed bilateral trade agreement between India and the US are expected to come up for discussion in the Board of Trade meeting on Tuesday, an industry official said.

Another exporter said that wage hikes due to the implementation of labour codes may also be flagged as a 5-6 per cent rise in wages may hurt the competitiveness of domestic goods in global markets.

Exporters would also urge the commerce ministry to release detailed guidelines on export promotion missions.

The Board of Trade (BoT), an advisory body under the commerce ministry comprising official and private members, is chaired by Commerce and Industry Minister Piyush Goyal.

All export promotion councils, key government departments, state representatives and industry associations will participate in the deliberations to discuss strategies to boost India's exports amid steep tariffs imposed by the US, the official said.

The meeting is important as the country's exports fell by a steep 11.8 per cent to USD 34.38 billion in October on account of the impact of high tariffs by the US, while the trade deficit widened to a record high of USD 41.68 billion, mainly due to a jump in gold imports.

India and the US are negotiating a bilateral trade agreement. The first phase of the pact is expected to be announced soon, which would address the tariff issue.

The value of the rupee against the US dollar may also figure in the meeting. The local currency has depreciated below the 89 level against the US dollar. The rupee settled at 89.16 against the greenback on Monday after hitting its all-time low of 89.66 against the US dollar on Friday. A weak rupee increases the realisations of exporters in the local currency but makes imports dearer.

Think tank GTRI said that the last ten years' data prove that a cheaper rupee cannot compensate for India's high-cost, over-regulated export ecosystem.

In 2013, the rupee traded at 60 to the dollar and merchandise exports were USD 313 billion, it said adding today the rupee is near 90, an extraordinary 50 per cent depreciation, yet exports have risen only to USD 440 billion.

"A weaker currency should have turbocharged India's export competitiveness, but the opposite occurred: high input tariffs, rigid standards, QCO-driven supply-chain blockages, costly logistics, and dependence on imported intermediates erased any currency advantage," GTRI Founder Ajay Srivastava said.

The meeting also assumes significance as India's merchandise exports to its largest export destination, the US, declined for the second consecutive month in October, falling by 8.58 per cent to USD 6.3 billion due to the hefty 50 per cent tariffs imposed by Washington.

To address global uncertainties at the trade front, the government, on November 12, approved an export promotion mission with an outlay of Rs 25,060 crore for six financial years, beginning 2025-26, to help exporters deal with high tariffs imposed by the US.

The mission will be implemented through two sub-schemes -- Niryat Protsahan (Rs 10,401 crore) and Niryat Disha (Rs 14,659 crore).

The Board of Trade provides an opportunity for discussions and consultations with trade and industry leaders as they advise the government on foreign trade policy measures to achieve the objective of boosting India's trade.

It also provides a platform for state governments and Union territories to articulate their perspective on trade policy and also for the central government to apprise them about international developments affecting India's trade potential and opportunities.

During April-October this fiscal, exports increased marginally by 0.63 per cent to USD 254.25 billion, and imports rose 6.37 per cent to USD 451.08 billion.

India is targeting USD 2 trillion worth of goods and services exports by 2030. PTI RR MR