The government has set an ambitious target of exporting $150 billion (Rs6.45 lakh crore) worth of goods in 2007-08, despite the strengthening rupee, and is counting on the special economic zones (SEZs) to help it reach that target.
In 2006-07, the government had expected to export $125 billion worth of goods, but provisional data available with the commerce ministry shows that it may have marginally missed this target and exported $122 billion of goods. The corresponding figure for 2005-06 was $100 billion.
Commerce and industry minister Kamal Nath is expected to announce the export target when he unveils the annual supplement to the Foreign Trade Policy on Thursday.
Senior officials at the ministry, who did not wish to be identified, defended the target and said it was based on the expectation that more SEZs would become operational by the end of the year (March 2008). “Their share in exports is expected to increase,” added one of the officials.
The commerce ministry has estimated that exports from SEZs would touch Rs67,299 crore in 2007-08, three times the exports of Rs22,839 crore from these zones in 2005-06.
The five-year Foreign Trade Policy (2004-09), announced by the ruling United Progressive Alliance (UPA) government in 2004, set an export target of $150 billion to be achieved by 2009.
Exporters do not necessarily share the government’s optimism. According to Ganesh Kumar Gupta, president of the Federation of Indian Export Organisations, an industry-body for the export trade, “Exporters would like to achieve the $150 billion target this year, but in the present situation, it seems highly unlikely. The rupee has appreciated by 9% in the last nine months from Rs46.50 to a dollar to Rs42.50 at present. Exports have witnessed a slowdown since December and now the appreciation is eating into exporters’ capital. Unless the situation improves, achieving the target will not be an easy job,” Gupta added.