New Delhi: Smiles returned to the faces of Indian exporters in 2010 after nearly 12 months of pain suffered by them due to recession in advanced economies, reports PTI.
October 2009 saw the tide turn in favour of Indian exporters and the situation kept getting better and better with each passing month of 2010.
“If you look at all the big ticket items on our exports—whichever you want to pick up—cumulatively, all of them had good growth rate for the April-November period,” commerce secretary Rahul Khullar said, summing up what he called the “real interesting story” of fiscal 2010-11.
So much so the value of the country's outbound goods consignment this fiscal is expected to far exceed the target of $200 billion. It was $179 billion in the previous year.
“Indian exports may reach a new milestone of $220 billion this fiscal, increasing the country’s share in the world trade,” Federation of Indian Export Organisations president A Sakthivel said.
Since things had gone so bad between October 2008 and May 2009 under the impact of demand-recession in all the major markets for Indian merchandise, the initial phase of recovery was seen as no great shakes because it came on the back of a low base of annual comparison.
But right from the first quarter of the fiscal 2010-11, the actual recovery was visible, helped by a turnaround in the US and European markets as also increased global prices in commodities.
Thanks to demand pick-up in the western stores and production facilities, India’s merchandise shipments went up by 26.7% to $140.3 billion between April-November, according to the official data.
In fact, as Mr Khullar put it, it was for the first time over a long period that the pace of growth in exports was faster than imports, which expanded by 24% in the eight months of the FY’11.
Consequent to exports doing well, worries on the balance of trade front have receded. The trade gap (difference between export and import) for the April-November period was $81.7 billion. At this rate, it could go anywhere between $120-$135 billion depending on the global prices of crude, which account for about 30% of the country's import bill.
From the point of view of realisations, engineering, gems and jewellery and petroleum products were the biggest contributors to the Indian export basket. The good news is that all the three have clocked huge growth in the first eight months of the fiscal.
Between April and November, engineering exports were up 50%, gems and jewellery 16% and petroleum products 41%.
Then there are sectors which do not bring in much in terms of value but are crucial for employment. These include sectors like carpet and leather, which have also shown smart growth.
While exports are doing well, there are some worries around the debt crisis in some of the European countries such as Ireland, Portugal and Spain, which may have contagion effect on rest of the continent.
Individually, these countries may not have much relevance to India, but Europe as a whole is relevant as it accounts for nearly 36% of Indian exports.
“Unless there is robust recovery in Europe, immediately we cannot shift our market and improve international trade scenario,” finance minister Pranab Mukherjee said recently.
On policy level, 2010 saw the government taking steps to increase India’s exports (imports too will increase) by entering into market opening free trade pacts with not only countries but with regions as a whole.
During the year, India entered into free trade agreements with South Korea and the 10-nation ASEAN and finalised agreements with Malaysia and Japan.
India and the 27-nation EU gave an impetus to their ongoing negotiations for a comprehensive trade pact, as leaders from the two sides called for concluding the agreement early next year.
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New Delhi: Set to monitor the second generation (2G) spectrum scam probe, the Supreme Court today widened the investigation in the case by bringing in its ambit the telecom policy from 2001 to 2008 covering both the NDA and the UPA regimes, reports PTI.
A bench comprising justices GS Singhvi and AK Ganguly made it clear that the emphasis of the investigation would be to determine the loss of money to the public exchequer and said a progress report on the probe has to be filed by the Central Bureau of Investigation (CBI) and Enforcement Directorate in a sealed cover on the next date of hearing on 10 February 2011.
However, the bench said there was no need for a special team to investigate the scam as the government has agreed for court-monitored investigation which is moving in the right direction and Solicitor General Gopal Subramanium and senior advocate KK Venugopal, appearing for CBI, have assured that there will be comprehensive investigation by the two agencies (CBI and ED).
“We are giving directions that the CBI shall carry investigation based on the CVC report and consider the findings of Comptroller and Auditor General (CAG) which has prima facie found that ineligible entities were granted licences,” it said.
The bench allowed the appeal filed by NGO, Centre for Public Interest Litigation (CPIL), against the Delhi High Court which had rejected the plea for CBI investigation into the irregularities in the grant of licence for 2G spectrum.
“The high court has committed serious error in dismissing the writ petition. Prima facie, there was sufficient material supported by documents to proceed on the allegation,” the bench observed.
The bench said that the report of the Central Vigilance Commission (CVC) and the findings of the CAG needed impartial investigation.
It said that how licences were granted to the ineligible operators has to be investigated and as to why the Telecom Regulatory Authority of India (TRAI) did not take action has to be looked into.
The bench said that the CBI should consider the investigations done by the CVC and the findings of the CAG on the irregularities, which according to it, were blatant violation of norms.
The bench further said that the investigation will also cover why roll out obligations were not fulfilled.
The bench asked the investigating agencies to probe the transfer of dual technology—CDMA and GSM—saying while the notification for the dual technology was issued on 19 October 2007, one of the service provider was given the permission a day earlier.
The investigation shall also cover huge loans by public sector banks and if the Department of Telecom (DoT) officials were signatory to the licence agreements, the bench said.
The bench directed the CBI and ED to carry out investigations without being influenced by any individual, their ranks, functionaries and agencies.
The bench asked the Directorate of Income Tax to hand over the transcripts of the tapped conversations carried out under the order of the home secretary to the CBI.
The court had reserved its judgement on 8th December after hearing arguments forwarded by CPIL, CBI, ED, DoT and former telecom minister A Raja who resigned from the cabinet in the wake of the scam.
In earlier hearings in the apex court, CVC PJ Thomas, whose appointment had come under a cloud, had offered to recuse himself from overseeing the CBI probe into 2G spectrum scam.
The recusal was prompted by SC’s posers about his ability to oversee the CBI probe into the 2G scam as he happened to be telecom secretary under A Raja, as well as in view of a pending charge-sheet against him in Kerala's palmolein import scam.
The apex court, while hearing arguments earlier, had favoured widening the ambit of the probe to include spectrum allocation since 2001 under the NDA regime.
“The issue raised in the case is not limited to only Rs1.76 lakh crore but has a much wider compass. We would not like to prejudice the probe. But what happened in 2001 needs to be looked into. It is for the CBI to investigate and find out,” the bench had observed.
Raja's counsel TR Andhyarujina, in his arguments, had maintained that his client had only been following up the 2001 policy initiated by his predecessors.
The court had also expressed surprise over public sector banks providing loans to the tune of Rs10,000 crore to the 2G spectrum licensees on the basis of hypothecation of their respective licenses.
“If it is true it is astonishing. It goes much far beyond what you are advancing,” the bench had quipped as Prashant Bhushan, appearing for CPIL and quoting various reports, told it about the disbursement of huge loans by various banks, including the State Bank of India (SBI) to licensees.
Mr Bhushan had told the bench that the SBI granted a Rs2,500 crore loan to Uninor, which is a joint venture between real estate major Unitech Ltd and Norway’s telecom giant Telenor.
“A bank, which is the most premier bank of the country, the State Bank of India, functioning under the Act of Parliament, is lending Rs10,000 crore. It is a matter of such great public importance. It needs to be covered under the CBI investigation,” the bench had observed while favouring “holistic investigation.”
Senior counsel KK Venugopal, who appeared for the CBI, had supported the bench's view saying that the CBI will register a separate case to probe the bank’s role in the fraud.
“The investigation on this issue cannot be carried out in the pending case and a fresh FIR has to be registered,” he had submitted.
The FIR in the telecom scam was registered by the CBI on 21 October 2009, against unnamed persons under various provisions of the Prevention of Corruption Act.
The ED had also lodged the complaint under the Prevention of the Money Laundering Act and Foreign Exchange Management Act.