Need to focus on project exports in developed nations: Piyush Goyal

Project exports refers to setting up of engineering and construction projects overseas. It also includes the export of engineering consultancy

Indian companies must explore engineering and construction projects in developed nations like the US as that carries lower risk and gives better rating, said Commerce and Industry Minister Piyush Goyal on Thursday.

He was referring to project exports that also include the export of engineering consultancy.

“We should not necessarily focus only on projects where there is government funding or lines of credit from the government or which are third world, backward or less developed countries. My sense is if someone gets a project in Europe, US, the risks are much lower and you can price your finances better. This will lower your capital requirements with a high credit rating of projects in developed countries,” Goyal said at an event organised by Export Import Bank of India (EXIM).

According to the minister, Exim Bank can conduct a study on the restrictions in the developed world, how can access of Indian companies in project exports be improved, what are the restrictions in their government contracts, among others. Apart from that , the market access problems for project exports can be addressed by the government through free trade agreements that India is negotiating and gearing up for currently.

As far as merchandise exports are concerned, the minister said that despite headwinds for international trade from Omicron, supply chain disruptions, and geopolitical conflicts, India exported goods worth $ 38 billion in April, which shows that the country is on a growth, revival path.

“There are serious concerns around overall supply chain disruptions because any one place goes into a lockdown, we don’t know the ramifications it will lead to. Of course, the Ukraine-Russia conflict can’t be ignored and it is at a very critical juncture with a lot of confusion and complications in our international trade at the moment,” he said.