Govt. to frame incentive policy for SEZs soon

By Our Special Correspondent

HYDERABAD, OCT. 29. The Government of India would soon be coming out with an incentive policy for Special Economic Zones (SEZs). Similarly, it had in principle agreed to the State Government's request to locate the headquarters of the Insurance Regulatory and Development Authority (IRDA) in Hyderabad, according to the Chief Minister, Mr. N. Chandrababu Naidu.

Mr. Naidu, who met the Prime Minister, Mr.A.B. Vajpayee, in Delhi on Sunday stated this while addressing a cross section of industrialists and exporters and importers, after inaugurating the Hyderabad office of the Exim Bank (Export-Import Bank of India), here on Monday.

Stating that India was not doing that well on the export front, Mr. Naidu emphasised the need to gear up to face competition from China, particularly after the November World Trade Organisation (WTO) meeting.

Mr. Naidu pointed out that India's exports had gone up from $32 billion in 1998 to $43 billion in 2001, against China's growth from $183 billion to $249 billion during the same period, and felt `India is likely to feel the heat of China's competitiveness'.

He suggested that Exim Bank take the initiative to streamline the financing structure for increasing exports. India would have to concentrate on greater thrust on reforms and infrastructure development. Domestic reforms have to be taken up to increase exports and Indian products' competitiveness, he observed.

Mr.T.C. Venkat Subramanian, Managing Director, Exim Bank, said Andhra Pradesh, with its agricultural and agro-based resources, minerals and ores and fast-growing IT sector had been contributing substantially to India's exports. Infrastructure facilities such as Export Processing Zones and Software Technology Parks had been playing a key role in promoting exports from the State.

Between 1996 and 2001, the State's exports grew at an average annual rate of 10 per cent. Software exports in particular had grown from Rs.135 crores in 1996-97 to over Rs.1900 crores in March 2001. Apart from its head office in Mumbai, the bank has eight offices including Hyderabad. It also has overseas offices at Budapest, Johannesburg, Milan, Singapore and Washington DC, he said.

Mr. M. Narasimham, Chairman, Administrative Staff College of India (ASCI), said exports need to be competitive and competitiveness itself was a derivative of productivity. The 20- year-old Exim Bank was an important constituent of the country's financial system, he said.

Mr.D.G. Prasad, General Manager, Exim Bank, said negotiations were on for extending a line of credit to many more countries like Russia, Venezuela and several African nations.

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