Export preparedness essentials

The Export Preparedness Index (EPI) 2021 compiled by the NITI Aayog holds out the mirror for Assam and other North-eastern states about their strengths and weaknesses as well as the challenges of harnessing the export potential of the region. Assam has moved up to 15th rank among 36 states and union territories as compared to 28th rank in EPI 2020 but as far as export shares are concerned, for all states in the region including Assam, it is a long way to go. The final EPI 2021 report states that in the "Landlocked" category, Assam is up to two notches over 2020 and now ranks 7th. The overall score is up 18.76 points to 41.57. Assam has improved in the eight sub-pillars and outperforms the national average in 4 of the 11 sub-pillars. Gujarat and Maharashtra have retained the first and second ranks with overall scores of 78.86 and 77.14 which also reminds the North-eastern states of the paradoxical situation of lagging far behind in export despite 98% of the region's boundary-sharing international borders. The report highlights that Assam's performance has shown the state's efforts to improve its trade support to exporters and it has held 15 trade fairs and conducted 21 workshops training for capacity building of exporters. "These factors have driven its score high overall," states the report. It, however, points out that the state has no district-specific export plan even though it has all the policy mechanisms. In the policy pillar which reflects whether policy measures have enabled necessary conditions to ensure a pathway for export-led growth in the region, Assam has performed "exceptionally well" in the category of landlocked states under the sub-pillar-Export Policy Promotion. In the other sub-pillar of Institutional Framework, the state underperformed with an overall score of 61.55 mainly on account of low scores in three of total nine parameters- Existence of DEPC (District Export Promotion Councils), meeting frequency of empowered committee and newsletters. In all other six parameters- Appointment of a full-time export commissioner, Existence of a state-centre coordination cell, International access, Existence of export promotion councils, Establishment and functioning of an empowered committee, and Grievance redressal under this sub-pillar the state scored 100 which are indicative of strengths. In the Business Environment sub-pillar under the Business Ecosystem pillar, the state has got high scores of 100 in respect of single window clearance and 97.44 in the parameter of labour reforms which is encouraging news for exporters and entrepreneurs. The scores concerning various parameters- Internet facilities, Number of industrial corridors, Industrial land, Number of clusters, Number of IT, Software and food parks under the sub-pillar infrastructure, except power availability, are quite low. The state has also performed poorly in respect of two other sub-pillars- transport connectivity and access to finance. This indicates that the state has a lot to improve concerning the area covered by air cargo facilities, the area covered by inland container depots, multimodal logistic hubs, banking facilities, export credit to exporters, FDI inflows and loan schemes for exporters. The report states that States like Sikkim, Manipur, and Mizoram can develop a competitive advantage in certain products that help close trade borders with neighbouring countries but except for Uttarakhand, other states in the Himalayan category that includes these North-eastern states lag in almost all pillars. The constraint of north-eastern states remains the same, the NITI Aayog report states, adding that they lack basic infrastructure and do not have the strong business environment to support a developed export infrastructure. Borders volatility and weak support to traders and existing businesses have driven scores of most of the states in this category down, it adds. These realities also bring two foreign politics of India into focus - Act East Policy and Neighbourhood First which have the northeast region at the centre of these policies, the slow pace of achieving the target objectives of unlocking the huge untapped potential of trade, the commerce of the region for deepening multilateral and bilateral engagements with ASEAN and neighbouring countries of Bangladesh, Bhutan and Nepal. The NITI Aayog states that Assam's performance in the sub-pillar Trade Support has emerged as "an excellent example for Himalayan region states on how the state's efforts improve its trade support to exporters and this observation will surely boost the confidence of the Assam Government and various stakeholders. When it comes to the northeast region and its export potential, connectivity projects dominate policy and media discourse. The EPI is a ready reckoner for the states in the region to identify gaps and take up corrective measures and focus on improving performance in respect of all pillars and sub-pillars ad various parameters that measure the performance. With the region coming out of the shadow of the COVD-19 pandemic, identifying exportable products in each district is vital to tapping the markets in the neighbourhood and beyond.