A report by the department-related Parliamentary Standing Committee on Commerce said the committee is perturbed to note the “precipitous” decline in both exports and imports in 2020 which is to the tune of around USD 50 billion and around USD 150 billion, respectively.
A parliamentary panel has suggested to the Department of Commerce to take appropriate measures to check further deterioration in exports and crucial imports for preventing more disruptions in the supply chains. A report by the department-related Parliamentary Standing Committee on Commerce said the committee is perturbed to note the “precipitous” decline in both exports and imports in 2020 which is to the tune of around USD 50 billion and around USD 150 billion, respectively.
The sluggish growth in exports before the occurrence of the COVID-19 pandemic has further witnessed a downturn in the event of measures taken globally to combat the pandemic, it said.
“The committee recommends the department that any further deterioration in exports and crucial imports may be checked by taking requisite measures for preventing further disruptions in supply chains in the trade,” it said.
On free trade agreements, it said in a globally competitive world wherein the international trade equations play a significant role, India may sign considerably more agreements with like-minded, democratic and friendly countries like the US and Australia.
“The committee, therefore, recommends that the department should explore the opportunities of FTAs with such nations by having wider consultations with relevant stakeholders and, accordingly, persuade the government to ink more trade pacts and agreements with them that are mutually beneficial,” it added.
It has also recommended that a spur in the growth of both exports and imports is required by addressing the supply side constraints and easing the trade procedures.
The committee suggested a comprehensive study to identify the major issues/challenges impacting the trade activities in India in the times of the COVID-19 pandemic.
“The study would help in identifying the structural infirmities existing in trade and exports that aggravated the deterioration of overall commerce of the country in times of crisis,” it added.
It has also recommended that any sudden and abrupt changes in freight rates may be countered by interventions by the government to impose regulations against cartelisation of rates and increasing the container production and shipping services.
“To tide over the paucity of the containers which was aggravated during Covid-19 pandemic, resulting in increased freight charges by shipping companies, the committee recommends that the prospect of manufacturing containers in the country may be explored with the infrastructure available in existing shipyards by providing them facilities/incentives,” it added.
To regulate the shipping freight rates in a fair and transparent manner, a national shipping regulatory body may be constituted on the lines of the Insurance Regulatory and Development Authority (IRDA) and Telecom Regulatory Authority of India (TRAI), it added.
On the scheme for Remission of Duties and Taxes on Exported Products (RoDTEP), it said the determination of ceiling rates for refunds under the scheme by the G K Pillai committee should be expedited to avoid any delay.
The panel has also recommended to further extend the interest subsidy scheme for a year since the abrupt discontinuation would adversely impact the MSME exporters in these difficult times.