Lok Sabha Question No. 4204 (UNSTARRED), answered on 2019-01-07
Subject: Exports from Labour Intensive Sectors
Ministry: COMMERCE AND INDUSTRY
Asked by: SUDHEER GUPTA, KUNWAR HARIBANSH SINGH, VIJAY KUMAR S.R.

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA UNSTARRED QUESTION NO. 4204 TO BE ANSWERED ON  07 th  JANUARY, 2019

## EXPORTS FROM LABOUR INTENSIVE SECTORS

4204.  SHRI SUDHEER GUPTA:

SHRI S.R. VIJAYAKUMAR:

KUNWAR HARIBANSH SINGH:

Will the Minister of COMMERCE & INDUSTRY ( वा ͨणÏय एवं उɮयोग मंğी ) be pleased to state:

- (a) the total quantity and value of exports from the labour-intensive sectors during each of the last three years, Sectorwise;
- (b) the percentage of total export of India from the labour-intensive sectors during the said period;
- (c) whether  the  exports  from  the  labour  intensive  sectors  have  declined  during  the period;
- (d) if so, the details thereof and the reasons therefor along with the corrective measures taken/being taken by the Government in this regard, sectorwise;
- (e) whether the Government has formulated any schemes to promote the exports from the labour intensive sectors and if so, the details thereof; and
- (f) the steps taken/being taken by the Government to include agricultural products/produce under the said scheme?

## ANSWER

okf.kT; ,oa m|ksx ea=ky; esa jkT; ea=h ¼Jh lh- vkj- pkS/kjh½

THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (SHRI C. R. CHAUDHARY)

(a) to (d): The  values  of  India's  merchandise  exports  and  exports  from  labour  intensive  sectors  along with the percentage share during the last three years are as follows:

(Value in US$ million)

| Years   |   Exports from Labour intensive sectors | %Change   |   India's merchandise exports |   %share of exports from labour intensive sectors |
|---------|-----------------------------------------|-----------|-------------------------------|---------------------------------------------------|
| 2015-16 |                                  116869 | --        |                        262291 |                                             44.56 |
| 2016-17 |                                  123443 | 5.63      |                        275852 |                                             44.75 |
| 2017-18 |                                  132132 | 7.04      |                        303526 |                                             43.53 |

Source: DGCI&S, Kolkata

The data in the above table reflect that the exports from labour intensive sectors registered a positive growth of 5.63% during 2016-17 over 2015-16. During 2017-18, it registered a positive growth of 7.04% over the year 2016-17. Due to different units of measurement, the total quantity of exports is not additive. However, the  sector-wise  details  of  quantity  and  values  of  exports  from  labour  intensive  sectors  for  last  three  years  is given at Annexure-I .

(e) & (f): In  order  to  promote  India's  exports  including  labour  intensive  sectors,  the  Government  has  taken several measures through new Foreign Trade Policy 2015-20 launched on 1 st April 2015, its Mid-term Review released on December 5, 2017 and other policy measures taken from time to time. The key measure includes:

- i. FTP 2015-20 provides a framework for increasing exports of goods and services as well as generation of employment and increasing value addition in the country, in line with the 'Make in India', 'Digital India', 'Skills India', 'Startup India' and 'Ease of doing business' initiatives.
- ii. The policy provides the framework for promotion of exports through schemes of incentives on exports and duty remission/exemption on inputs for export production.
- iii. The policy introduces two new schemes, namely 'Merchandise Exports from India Scheme (MEIS)' for  improving  export  of  specified  goods  by  merging  five  earlier  schemes  for  better  coherence  and 'Services Exports from India Scheme (SEIS)' for increasing exports of notified services.
- iv. The  Merchandise  Exports  from  India  Scheme  (MEIS)  was  introduced  in  the  Foreign  Trade  Policy (FTP) 2015-20 on April 1, 2015 with the objective to offset infrastructural inefficiencies and associated costs involved in exporting goods/ products which are produced/ manufactured in India. The Scheme incentivizes exporters in terms of Duty Credit Scrips at the rate 2, 3, 4, 5 and 7, 10 and 20% of FOB value of exports realized. The Scheme covers exports of 8057 tariff lines. The total annual financial envelope available for MEIS for Financial Year 2018-19 is Rs 30,819.91 crore. On the demand of the industry,  at  the  time  of  mid-term  review  of  the  FTP  in  Dec  2017,export  rewards  under  MIES  were increased by 2% across the board for labour intensive, MSME sectors, ready-made garments and made ups. Later, rewards to some agricultural products such as Bengal Gram, Milk and Milk Products, Soya de-oiled cake and Non Basmati rice have been provided/ enhanced under MEIS for a limited period in the year 2018-19 to boost the exports of these agriculture sector items. As on date, the MEIS scheme covers 8057 tariff lines at 8 digits level, and provide rewards.
- v. Interest Equalization Scheme on pre and post shipment rupee export credit introduced from 1.4.2015 helps  exporters in accessing credit  at reduced  rates.  Still then, it  was  observed that  MSME  sector  is facing  multiple  problems.  One  of  the  problems  faced  by  the  MSME  exporters  is  access  to  low  cost export finance to make them internationally competitive. Therefore, interest equalization reduces the cost  of  the  credit  offered  by  banks  to  exporters  and  serves  as  a  complementary  tool  for  enhancing India's exports. Keeping in view the poor performance of exports from MSMEs and the difficulties faced by  them  in  accessing  loan  at  competitive  rates,  it  has  been  decided  that  the  MSME  exporters would be given extra push by way of enhancing interest equalization rate from 3% to 5%. Accordingly, CCEA in its meeting held on 1.11.2018 has given its approval on increasing the interest equalization rate from 3% to 5% for exports being made by MSME sector under the ongoing Interest Equalization Scheme on pre and post Shipment Rupee Export Credit along with providing operational flexibility to carry out modifications in the scheme from time to time without changing its basic character.
- vi. The Government has implemented the Niryat Bandhu Scheme with an objective to reach out to the new and potential exporters including exporters from Micro,  Small & Medium Enterprises (MSMEs) and mentor  them  through  orientation  programmes,  counseling  sessions,  individual  facilitation  etc.,  on various aspects of foreign trade for being able to get into international trade and boost exports from India.
- vii. A new  scheme  called  Special  Advance  Authorisation  Scheme  for  export  of  articles  of  Apparel  and Clothing Accessories was introduced w.e.f. 1st September 2016 wherein exporters are entitled for an authorisation  for  fabrics  including  inter  lining  on  pre-import  basis  and  all  industry  rate  of  Duty Drawback for non-fabric inputs on the exports.
- viii. Trade  facilitation  and  enhancing  the  ease  of  doing  business  measures  have  been  taken  with  special focus on moving towards paperless working. The Government has launched a Single Window Interface for Facilitating Trade (SWIFT) clearances project with effect from 1 st April, 2016. The scheme enables the  importers/exporters  to  file  a  common  electronic  'Integrated  Declaration'  on  the  Indian  Customs Electronic Commerce/Electronic Data Interchange (EC/EDI) Gateway i.e. ICEGATE portal. India also ratified the WTO Agreement on Trade Facilitation (TFA) in April 2016 for enhancing trade facilitation.
- ix. The Mid-term Review of Foreign Trade Policy 2015-20 launched on 5 th December 2017 provides more incentives for export promotion. Export incentives under MEIS have been increased by 2% for labour intensive  and  MSME  sectors  leading  to  additional  annual  incentive  of  Rs  4,567  crore.  This  was  in addition to already announced  increase in MEIS incentives from 2% to 4% for Ready-made Garments and Made Ups in the labour intensive Textiles Sector with an additional annual incentive of Rs 2,743 crore.
- x. In  order  to  double  farmers'  income  by  2022  and  provide  an  impetus  to  agricultural  exports,  the Government has launched a comprehensive 'Agriculture Export Policy' on 6 th December, 2018 which

would also integrate Indian farmers and agricultural products with the global value chains. Objectives of the Agriculture Export Policy are as under:

-  To double agricultural exports from present ~US$ 30+ Billion to ~US$ 60+ Billion by 2022 and reach US$ 100 Billion in the next few years thereafter, with a stable trade policy regime.
-  To diversify our export basket, destinations and boost high value and value added agricultural exports including focus on perishables.
-  To  promote  novel,  indigenous,  organic,  ethnic,  traditional  and  non-traditional  Agri  products exports.
-  To provide an institutional mechanism for pursuing market access, tackling barriers and deal with sanitary and phyto-sanitary issues.
-  To strive to double India's share in world agri exports by integrating with global value chain at the earliest.
-  Enable farmers to get benefit of export opportunities in overseas market.
- xi. In addition to above, financial assistance under Agriculture Export Promotion Plan Scheme of APEDA were  provided to exporters for export of APEDA's  scheduled  products  under  the  following components:
- i. Development of export infrastructure
- ii. Quality development
- iii. Market development

***

## Statement referred to in reply of part (a) of Lok Sabha Unstarred question no. 4204 for answer on 7 th January 2019.

## India's Export of Labour Intensive Sectors

(Value in US$ million)

| S. No.   | Labour Intensive Sectors       | Unit   | 2015-16   | 2015-16   | 2016-17   | 2016-17   | 2017-18   | 2017-18   |
|----------|--------------------------------|--------|-----------|-----------|-----------|-----------|-----------|-----------|
| S. No.   | Labour Intensive Sectors       | Unit   | Qty       | Value     | Qty       | Value     | Qty       | Value     |
| 1        | Ac, Refrigeration Machnry Etc  |        |           | 1058.14   |           | 983.59    |           | 1294.63   |
| 2        | Aircraft, Spacecraft And Parts |        |           | 3959.11   |           | 3381.66   |           | 2264.27   |
| 3        | Aluminium, Products Of Aluminm | TON    | 1158767   | 2639.74   | 1552536   | 3244.69   | 2018992   | 4800.89   |
| 4        | Atm, Injctng Mlding Mchnry Etc |        |           | 1263.42   |           | 1268.77   |           | 1521.53   |
| 5        | Auto Components/Parts          |        |           | 4217.58   |           | 4205.38   |           | 5207.24   |
| 6        | Auto Tyres And Tubes           | NOS    | 27911579  | 1388.68   | 31342904  | 1494.25   | 30555026  | 1785.96   |
| 7        | Bicycle And Parts              |        |           | 298.44    |           | 293.68    |           | 328.20    |
| 8        | Carpet(Excl. Silk) Handmade    | SQM    | 101015566 | 1437.82   | 103389966 | 1480.69   | 105108201 | 1427.14   |
| 9        | Copper And Prdcts Made Of Copr | TON    | 424485    | 2539.75   | 458480    | 2672.94   |           | 3481.36   |
| 10       | Cotton Fabrics, Madeups Etc.   |        |           | 5266.23   |           | 5212.53   |           | 5482.87   |
| 11       | Cotton Yarn                    | TON    | 1307110   | 3608.12   | 1156331   | 3337.49   | 1097389   | 3424.92   |
| 12       | Cranes, Lifts And Winches      |        |           | 432.70    |           | 386.28    |           | 385.44    |
| 13       | Electric Machinery And Equipme |        |           | 3925.41   |           | 4742.25   |           | 6708.29   |
| 14       | Finished Leather               | KGS    | 51638460  | 1049.47   | 46526196  | 887.03    | 43410934  | 873.97    |
| 15       | Floor Cvrng Of Jute            | SQM    | 6259182   | 34.01     | 5105462   | 37.75     | 5792024   | 46.48     |
| 16       | Footwear Of Leather            |        |           | 2148.41   |           | 2127.90   |           | 2194.73   |
| 17       | Gold                           | KGS    | 150752    | 5573.54   | 152922    | 6121.43   | 59631     | 2393.74   |
| 18       | Gold And Oth Precs Metl Jwlery |        |           | 10958.79  |           | 11934.61  |           | 12807.35  |
| 19       | Handloom Products              |        |           | 368.57    |           | 359.73    |           | 355.94    |
| 20       | Hnd Tool, Cttng Tool Of Metals |        |           | 640.99    |           | 638.95    |           | 711.60    |
| 21       | Ic Engines And Parts           |        |           | 2109.93   |           | 2115.14   |           | 2402.94   |
| 22       | Indl. Machnry For Dairy Etc    |        |           | 4645.77   |           | 4640.98   |           | 5344.58   |
| 23       | Iron And Steel                 | TON    | 7570179   | 5492.56   | 14035205  | 8683.01   | 15888130  | 11244.74  |
| 24       | Jute Hessian                   |        |           | 125.54    |           | 138.23    |           | 141.23    |
| 25       | Jute Yarn                      | TON    | 16930     | 18.34     | 9076      | 10.65     | 16976     | 20.20     |
| 26       | Jute, Raw                      | TON    | 25107     | 17.18     | 18184     | 11.44     | 27199     | 14.81     |
| 27       | Lead And Products Made Of Led  | TON    | 89390     | 181.53    | 108063    | 236.89    | 159531    | 396.65    |
| 28       | Leather Garments               | KGS    | 7770092   | 553.98    | 7511083   | 535.37    | 7423050   | 519.32    |
| 29       | Leather Goods                  |        |           | 1370.86   |           | 1316.59   |           | 1365.79   |
| 30       | Machine Tools                  |        |           | 393.82    |           | 452.01    |           | 470.38    |

| S. No.                                     | Labour Intensive Sectors                   | Unit   | 2015-16   | 2016-17   | 2017-18   | 2015-16   | 2016-17   | 2017-18   |
|--------------------------------------------|--------------------------------------------|--------|-----------|-----------|-----------|-----------|-----------|-----------|
| S. No.                                     | Labour Intensive Sectors                   | Unit   | Qty       | Value     | Qty       | Qty       | Value     | Qty       |
| 31                                         | Manmade Yarn,Fabrics,Madeups               |        |           | 4621.66   |           | 4557.08   |           | 4826.33   |
| 32                                         | Medical And Scientific Instrum             |        |           | 994.38    |           | 1176.69   |           | 1429.32   |
| 33                                         | Motor Vehicle/Cars                         | NOS    | 1139434   | 6727.45   | 1126223   | 7547.45   | 1222665   | 8472.51   |
| 34                                         | Nickel, Product Made Of Nickel             | TON    | 37605     | 492.84    | 9045      | 92.65     | 3190      | 44.78     |
| 35                                         | Nucler Reactr, Indl Boilr, Prt             |        |           | 680.85    |           | 669.96    |           | 606.55    |
| 36                                         | Office Equipments                          |        |           | 89.50     |           | 117.92    |           | 78.60     |
| 37                                         | Oth Non Ferous Metal And Prodc             | KGS    | 91130806  | 431.80    | 91490179  | 446.17    |           | 505.18    |
| 38                                         | Other Construction Machinery               |        |           | 1079.38   |           | 1067.42   |           | 1441.75   |
| 39                                         | Other Jute Manufactures                    |        |           | 117.47    |           | 123.31    |           | 127.17    |
| 40                                         | Other Misc. Engineering Items              |        |           | 1990.57   |           | 2132.95   |           | 2435.91   |
| 41                                         | Other Precious And Base Metals             |        |           | 447.29    |           | 421.66    |           | 461.43    |
| 42                                         | Othr Rubber Prodct Excpt Footw             |        |           | 922.24    |           | 961.33    |           | 1161.96   |
| 43                                         | Prime Mica And Mica Products               | KGS    | 1047310   | 17.08     | 1084310   | 18.17     |           | 20.77     |
| 44                                         | Products Of Iron And Steel                 |        |           | 6142.47   |           | 5895.44   |           | 6770.20   |
| 45                                         | Project Goods                              | KGS    | 3785921   | 29.01     | 3559862   | 28.74     | 656036    | 21.95     |
| 46                                         | Pumps Of All Types                         |        |           | 707.66    |           | 761.50    |           | 966.99    |
| 47                                         | Railwy Trnsprt Equipmnts, Prts             |        |           | 110.06    |           | 231.92    |           | 346.81    |
| 48                                         | Rmg Cotton Incl Accessories                |        |           | 9091.58   |           | 8513.22   |           | 8510.76   |
| 49                                         | Rmg Manmade Fibres                         |        |           | 4181.77   |           | 5035.94   |           | 4746.97   |
| 50                                         | Rmg Of Othr Textle Matrl                   |        |           | 3184.53   |           | 3462.79   |           | 3122.15   |
| 51                                         | Rmg Silk                                   |        |           | 244.10    |           | 141.71    |           | 157.92    |
| 52                                         | Rmg Wool                                   |        |           | 262.38    |           | 214.50    |           | 169.14    |
| 53                                         | Ship, Boat And Floating Struct             |        |           | 3984.52   |           | 4370.60   |           | 3074.94   |
| 54                                         | Silk Carpet                                | SQM    | 29680     | 2.25      | 45578     | 9.50      | 17527     | 2.68      |
| 55                                         | Silver                                     | KGS    | 29946     | 7.36      | 32721     | 11.29     | 29490     | 10.21     |
| 56                                         | Sports Goods                               |        |           | 227.72    |           | 224.83    |           | 232.80    |
| 57                                         | Tin And Products Made Of Tin               | TON    | 3654      | 57.22     | 520       | 8.84      | 572       | 11.10     |
| 58                                         | Two And Three Wheelers                     | NOS    | 2531371   | 1777.86   | 2392382   | 1638.19   | 2784365   | 2001.48   |
| 59                                         | Zinc And Products Made Of Zinc             | TON    | 257627    | 527.07    | 228016    | 609.71    | 286964    | 956.18    |
| Total export from Labour Intensive Sectors | Total export from Labour Intensive Sectors |        |           | 116868.51 |           | 123443.40 |           | 132131.75 |
| India's Total Exports                      | India's Total Exports                      |        |           | 262291.09 |           | 275852.43 |           | 303526.16 |
| %share of labour intensive sectors         | %share of labour intensive sectors         |        |           | 44.56     |           | 44.75     |           | 43.53     |

Source: DGCI&S, Kolkata

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