Piyush Goyal
Piyush Goyal

India's balance of payments this year is going to be "very very strong" on the back of significant improvement in exports and a fall in imports, Commerce and Industry Minister Piyush Goyal said on Monday.

He said that "good" green shoots are visible in the economy and exports have shown a "good" turnaround.

"We are in July at about 91 per cent export level of July 2019 figures. Imports are still at about 70-71 per cent level of July 2019. So, broadly our balance of payments this year is going to be very very strong, which is why we feel confident that Indian industry will see opportunities for themselves, will see opportunities of growth," he said at a Ficci webinar.

India's exports fell for the fourth straight month in June as shipments of key segments like petroleum and textiles declined but the country's trade turned surplus for the first time in 18 years as imports dropped by a steeper 47.59 per cent.

The country posted a trade surplus of USD 0.79 billion in June.

Goyal said that the government is taking steps to support and promote domestic manufacturing and industry.

"We shall ensure that any unfair treatment meted out to Indian industry across the world will be taken up at the highest levels on your (domestic industry) behalf," he said.

He also said that some people are criticising the government's move to promote and support domestic industry by imposing certain restrictions on some products.

Earlier those people used to ask for steps to support domestic industry as businesses cannot compete with those countries which are following unfair trade practices or are providing hidden subsidies.

"But when you do the necessary enablement to support domestic manufacturers and industry, you find some voices trying to give you 'gyan', trying to be prophetic...saying no this is going back to the 1990s, you are going back to the license raj. It shocks me, when people do not understand as this is not business among equals," the minister said.

India has recently imposed import curbs on products like television sets and tyres.

Citing examples of tyres, he said it should not be the case that some country in the world does not provide access to Indian tyres, but wants to export this item to India freely.

Similarly, "how can it be that my medicines cannot go to another country but they want their products to be sold in India. The world works with equal terms, there have to be equal, fair and reciprocal arrangements," he said.

"If other countries are desirous of the 1.3 billion Indian market opportunity, they want to provide services to meet our needs, they also have to give our businesses equal opportunity to engage with them. They cannot put over arching technical barriers or overarching regulations," he added.

The minister also expressed surprise that some countries of Europe complain about the technical standards imposed on tyres in India. "I can list out 5,000 items on which technical standards have been put in their countries. Why should India not have the right to put technical standards," he added.

Before complaining about India, they should first talk to their own governments and make sure that their government's provide fair and equitable access to Indian goods, he said.

Further Goyal said that foreign companies which are assembling products in India should gradually and in a phased manner look at indigenising their products.

"If they (foreign companies) have invested in India and they want to engage with Indian market, I would believe that they should look at indigenising particularly those items where India has capabilities...

"We do not get excited only about an investment which is brought into India to capture the Indian market to save probably some import duty on the finished product and then come to India only to assemble those products," he said.

He added that companies setting up factories in India should look at bringing technology to India and produce and add value in India, rather than just importing components to do assembling here and "not just remain a screw driver technology for assembly workshops".

The minister said that it may not sound "very good" to certain businesses but it is time when Indian industry should stand up as one and ensure that "we get" a level playing field.

"I certainly do not believe that India is a weak-kneed nation that it is only going to be an assembly workshop for countries to bring completely knock down kits or semi-knock down kits and assemble them in India and supply to the Indian market. I think they should in a phased manner look at sourcing from India, developing their products in India and then encash the large business opportunity that 1.3 billion Indians are offering to businesses across the world," he said.

He emphasised that India allows free flow of goods but it has to be reciprocal and it cannot be one sided.

The minister also said that some countries do not allow products from India to enter their markets because of their local industry.

Without taking names, he said that there are countries that do not allow Indian steel to enter their market and some countries have agencies for import of steel, "what right they have to insist that India should have an open market for any and everything they want to export into India." "I think Indian products deserve fair access in those countries before they can expect unlimited access in Indian market," he added.

Countries that give fair access to Indian goods will get similar access here as it will be a two-way traffic and the country is moving towards balanced trade with more and more countries and regions, he said.

On free trade agreements, he said the FTAs which India has entered in 2009, 2010 and 2011, "we are finding complete asymmetries".

There are non-tariff barriers being imposed, Indian goods are not allowed to take the benefit of FTAs, whereas large quantities of products are coming into India through these agreements, he said.

"I think it is important that we ensure fair and equitable engagement and trade between countries and regions...I hope Indian industry will help us in giving fair trade treatment to our products," he added.

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