Project exports are a development venture which comprises a set of objectives to be achieved within a period. Executing a project involves different aspects that need to be considered – technological preparedness, continuous innovation, employing the best manpower, and financial and physical resources to create a capital asset. The project involves proper planning and monitoring for efficiency and achieving optimal results.
Project Exports can be broadly defined as the setting up of overseas projects involving undertaking contracts for engineering, procurement, and construction. It could also include designing, manufacturing, supply, and commissioning – in simple terms, it can be defined as the export of goods and services based on deferred payments.
Project Exports in various countries are determined by the economic and political conditions across the globe, the technological advancements, and the investment policies of various developed and developing countries.
Project Exports is set to be the helm of India’s Growth Agenda
In India, there is growing importance to building export competitiveness which puts us on the global front in terms of market and economy. During the COVID-19 pandemic, the public budget has been stretched putting the whole focus on health care which was an absolute necessity. Over the last two years, public expenditure has been narrowed down, but the economy is slowly building, shifting our focus towards exports and imports to boost the economy.
Project Exports is set to be the helm of India’s economic growth over the years.
The Government of India set up Project Export Promotion Council (PEPC) in 1984 as part of the export council. It is in line with the Foreign Trade Policy of the Government which not only helps in taking up export initiatives but also provides necessary support and guidance to the public as well as private sector projects to be set up overseas.
Project Export has to work by the guidelines prescribed by the Reserve Bank of India. The Export and Import Bank of India (EXIM) is the export financing institute that integrates investment and foreign trade into the country’s economic growth. It is the prime mover in encouraging project exports on a high scale. Recently in June 2022, Finance Minister Nirmala Sitharaman announced Rs 33,000 crore for Project Exports through National Export Insurance Account (NEIA).
India as an emerging economy on the global front will have many benefits in the long run by investing in such policies. It increases employment opportunities, ensures trade balance by earning more through additional foreign exchange, it recognizes Indian expertise in designing and monitoring projects on a high scale. It improves project bankability and increases the importance of recognition in a foreign jurisdiction for foreign exports which in turn makes the project more valuable.
India hasn’t been able to realize its potential in Project Exports because of various loopholes and restrictions that exist in our system which makes growth a complicated process. Indian Administration consists of a humongous line of division of powers which results in rigid compliance procedures.
There is no single window clearance for undertaking projects, it has to go through the entire system. Lack of efficient support from the government in terms of investment. There is an absence of interest equalization which is important to undertake capital-intensive projects.
To be included in the global value chain, India needs to make strategic alliances through Project Exports which will result in technical collaborations with countries across various geographies. Over the last few years, India has been actively participating in the export market and building a name. In the present world of globalization with integration and interconnectedness among various nations, India can provide its technical and engineering expertise to build its reputation.
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