R S Gujral, an IAS officer from the 1975 batch of Haryana cadre took charge in June 2007 as director general of foreign trade (DGFT). He took over after his predecessor Bhawani Singh Meena moved out following differences with then commerce minister Kamal Nath.

Not only has Gujral steered clear of controversies, but provided the much-needed stability and continuity to foreign trade policy formulation. He has teamed up well with commerce secretary Rahul Khullar to give an impetus to sagging exports.

In a freewheeling interview with K A Badarinath & Nayanima Basu, the soft spoken and suave bureaucrat argued it was possible to bring exports back on to high growth trajectory with 25 per cent annual growth through specific FTP measures. Excerpts:

Do you think the exporters can trade scrips relating to duty free imports?

Duty free import authorisation or DFIA scrips can be transferred or used individually. served from India scheme (SFIS) scrips are not transferable but can be used for domestic procurement. The benefit for service exporters is at a 10 per cent level which is the maximum benefit provided under the policy. The intention is to provide them (service providers) inputs and capital goods for their own use that is why that has not been made transferable.

What is the idea behind announcement on diamond bourses?

We have planned to set up diamond bourses to trade internationally. Our endeavour is to make India an international diamond trade hub. We already have diamond bourses in Surat and Mumbai. The objective is to set up more such bourses so that in the long run we can make India a centralised diamond-trading hub. We are trying to become like Antwerp.

Will government consider allowing zero-duty imports beyond next financial year?

The government has made it clear. Zero duty imports facility allowed through EPCG scheme and one percent additional duty scrips has a clear sunset clause. This is for purposes of capital up-gradation in certain defined sectors such as leather, textiles and handicrafts for exports. Imports made for export purposes would be eligible for zero duty regime. Cost-effective import of capital goods for technological up gradation is the focus.

Is the impact of economic turmoil a cause for concern?

Certain sectors have shown resilience in the downturn. We need to evaluate the impact and decline in two ways – one in terms of volume and second in price terms. Products that are linked to crude prices, their international prices have gone down by half with the falling prices of crude. This does not impact the industry. Prices of certain other commodities have gone down. For instance, iron ore, non-ferrous metals prices have declined, which is not a serious issue. Sectors where volume has got affected are diamond, textiles, and the effort is to support them by diversifying them to newer markets.



Is there any logic in setting up the directorate of trade remedy measures?

This is an effort to bring in all kinds of trade remedy measures under a single window. Trade remedy measures cover both anti-dumping as well as countervailing measures. An inter-ministerial committee will be formed with the revenue secretary and commerce secretary as main members. With regards to subsuming the existing bodies into the new directorate, we are yet to work on it.

What is the thinking behind giving special waiver from duties payable by exporters on imports meant for re-export purposes?

So far, whenever an exporter was unable to realize exports proceeds, he had to refund the incentives he used to get. But, now, it has been decided that if he has made adequate efforts and still unable to realise the export proceeds then the government will not punish him by asking for refund. RBI will give the special waiver after receiving a certificate from the exporters.

What is the progress on electronic data interchange (EDI)?

A very significant portion of EDI initiative and regulation of transaction costs is being implemented as part of e-trade project. The commerce secretary is monitoring the project on a regular basis. Once the online system of customs is totally centralised, then issues relating to high transaction costs will all disappear. The incentives schemes announced in trade policy will be made online within the next three months. But once the e-trade project extends, then the present level of ports connectivity will also extend in a gradual manner.