The budget proposal of Rs 11,600 crore for outer harbour projects can result in propelling growth in exports starting from the current financial year itself, if implemented in letter and spirit, according to Walter D'Souza, Chairman (Southern Region), Federation of Indian Export Organisations (FIEO).
One of the most crucial impediments faced by Indian exporters have always been the high transaction costs compared to their peers through the length and breadth of the world, which have been mainly due to poor infrastructure, he said.
It has become imperative for emerging economies to adopt measures to change fundamentals, facilitate external adjustments, and streamline monetary policy by having in place result-oriented structural reforms. The budget has made earnest efforts in this direction, D’Souza said.
If not world-class, at least reasonably good infrastructure without many bottlenecks for seamless surface and sea transportation is the key to exponential growth in India's foreign trade. The budget has made an effort to address these issues to a certain extent. The rate of success will depend on the urgency and pace at which implementation will be carried out, he said.
However, it is disheartening to note that the industry plea for exemption of service tax on all export-related transactions has become a cry in the wilderness. It can have negative impact on the export growth if not considered positively, while passing the budget in Parliament, he added.