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Unlocking Assam's export potential

Exports play a critical role in economic growth but has remained abysmally low in Assam. The Export and Logistic

Assam

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  1 Aug 2020 5:50 AM GMT

Exports play a critical role in economic growth but has remained abysmally low in Assam. The Export and Logistic Policy of Assam, 2019 holds out promises to boost export from the state. Apart from diversifying the export basket, the state needs to focus on rising export from India to ASEAN countries to achieve the objectives stated in the policy. Key objectives of the policy includes boosting exports where Assam has competitive advantage, enhancing the ease of doing exports through creation of simple, effective and efficient institutional mechanisms, simplified processes and efficient organization and coordination with the stakeholders and strengthening the export infrastructures of the state such as inland container depots, border trade centres, common facility centres, integrated cold chain, logistic park, river ports and material handling facilities, air cargo facilities, quality testing labs and connectivity to ports. These objectives are not new and do not excite anyone in the state. The challenge lies in achieving them before the validity of the current policy expires in 2024. Assam's share in the country's total export declined to 0.10 per cent and stood at 254.65 million dollars in April-December 2018 from 0.13 per cent (354.96 million dollars) in 2017-18. Exports from India to ASEAN countries accounted for 11.15 per cent of the country's total exports during April 2018- January 2019. The value of export to the region grew from 28227.11 million dollars in April-January 2018 to 30147.09 million dollars in April-January 2019. It is paradoxical that Assam and other North-eastern states are the immediate Indian neighbours of ASEAN. India's Northeast region shares 98 per cent international boundaries with Myanmar, Bangladesh, China, and Bhutan while it shares only two per cent of its boundary with the rest of country. For nearly three decades India experimented with its foreign policy outlook towards ASEAN making a shift from "Look East" policy to "Act East" policy. Assam and other North-eastern states have been looking at the ASEAN region and discussing about the potential of engagement with the neighbours but remained clueless how to unlock the growth potential. India's exports to Bangladesh and Bhutan, which share international borders with Assam, have also gone up. Numbers show that Jaigaon border trading point in West Bengal caters to 90 of India's trade with Bhutan and the state's Petrapole integrated check post accounts for 70 per cent of the India-Bangladesh trade. Incentives announced in the policy like capital subsidy for creation of export Infrastructure like multi model logistic park, inland container depot, container freight station, air cargo facilities, common facility centres, pack houses, cold storage etc. are aimed at attracting potential investors and existing exporters. However, grooming local exporters is more important to ensure that infrastructure to be created are put to optimal use in tapping the state's export potential. Exporters and importers from outside the state often find their existing channels from respective states instead of coming to Assam for trade engagement with ASEAN. Sixteen states in India account for 96 per cent of India's total exports. Maharashtra has the highest share of 22.11 per cent followed by Gujarat with 20.51 per cent and Tamil Nadu with 9.23 per cent. Investment by the State government with funding support from the Central government to create the infrastructure and logistics will go a long way in achieving the primary objective of the policy. Creating a database of all the infrastructure and logistics projects- completed, under implementation and planned by different departments of both the State and Central governments and making it easily accessible in the public domain will help existing and potential exporters explore new export business to diversify the state's export basket. The policy takes note that tea is the major item in Assam's export basket. The state accounts for more than 50 per cent of India's tea production. The country exported 254.50 million kg tea worth 787 million dollars during April 2018 to March 2019 which declined to 240.02 million kg worth 764.80 million dollars during April 2019-March 2020. There is huge potential for exporting Assam tea to the ASEAN markets and the industry can leverage policy objectives and incentives to fully tap the potential. The state has huge potential for exporting fresh as well as processed foods. Setting up the coal storage and creating the cold chain, modern cargo facilities will be needed for exporting fresh foods and food processing industries are needed to prevent wastage of surplus fresh fruits and covert into value-added exportable items. Assam Bamboo and Cane Policy, 2019 can be leveraged by exporters to tap the huge potential of exporting cane and bamboo products and edible bamboo products to the ASEAN markets. It requires convergence of policies and coordination between the departments concerned with the Industries and Commerce department. Prioritising export promotion will open a new window of opportunities in Assam.

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