Chanakya IAS Academy Blog

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Government clears three exports infra plans

The Centre has given its approval for three proposals, an Integrated Cargo Terminal (ICT) at the Imphal International Airport, modernisation of infrastructure facility in Karnataka for marine exports and construction of a new ‘Standard Design Factory’ building at Cochin Special Economic Zone (SEZ).

The applications were approved by an Empowered Committee (EC) chaired by Commerce Secretary Rita Teaotia under the Trade Infrastructure for Export Scheme (TIES).

With deficient infrastructure severely hurting the competitiveness of India’s exports there is an urgent need to create export infrastructure.

Trade Infrastructure for Export Scheme (TIES):

  • The TIES have a budgetary allocation of 600 crores whereas the annual outlay of the scheme 200 crore
  • The objective of the TIES is to enhance export competitiveness by bridging gaps in export infrastructure, creating focused export infrastructure and first-mile and last-mile connectivity

According to a March 2016 report on ‘Export Infrastructure in India’

  • The report was published by the Department Related Parliamentary Standing Committee on Commerce:
  • Deficient infrastructure along with the manner in which infrastructure is being operated (in India) are the major obstacles to ensure competitiveness in manufacturing of goods and exports
  • Indian exports also lose competitiveness at the global level on account of huge logistics costs
  • The logistic cost in India is about 14% of the GDP whereas in advanced economies like the U.S. and the European Union, it is 8% and 10% of the GDP respectively
  • India can save up to $50 billion if logistics costs are brought down from 14% to 9% of country’s GDP thereby making domestic goods more competitive in global markets
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