FOCUS: LAC A STRATEGY FOR TRADE INITIATIVE

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• FOCUS LACA STRATEGY FOR TRADE INITIATIVE

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LAC OVERVIEW

• REGION COVERING 43 COUNTRIES
• GDP US 2170 BILLION (2000)
• POPULATION 502 MILLION
• FDI INFLOW US 86.17 BILLION (2000)
• FDI OUTFLOW US 13.44 BILLION(2000)
• SECOND FASTEST GROWING REGION OF THE WORLD

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IMPORTANT TRADING PARTNERS

• BRAZIL, MEXICO, ARGENTINA, CHILE AND PERU
  CONSTITUTE MORE THAN 70 OF INDIAS EXPORTS TO
  THE REGION
• BRAZIL-MAJOR ECONOMY OF THE REGION-CONSTITUTES
  27 OF INDIAS EXPORT TO THE REGION-GATEWAY TO
  MERCOSUR

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TRENDS OF TRADE

• ACCOUNTS FOR 5 OF WORLD TRADE.
• RICH IN NATURAL RESOURCES-MINIRALS, MARINE, AGRO
  PRODUCTS, FOREST, ETC
• POTENTIAL NOT TAPPED FULLY.
• RECENT LIBERALISATION PROCESS HAS RESULTD IN
  INTEGRATING THESE ECONMIES WITH THE GLOBAL
  ECONOMIC SYSTEM

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LAC - TRENDS

• PROXIMITY TO HUGE MARKETS, AND THE US IN
  PARTICULAR
• REGIONAL INTEGRATION ARRANGEMENTS, MERCOSUL,
  ANDEAN PACT, ASSOCIATION OF CARIBBEAN STATES
  (CARICOM), CARRIBIAN COMMON MARKET (CACM).

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INDO-LAC COMMERCIAL

• INDIAS SHARE IN THE GLOBAL TRADE OF LATIN
  AMERICAN COUNTRIES CONSTITUTES ONLY 0.25 OF
  LACS GLOBAL TRADE.
• LAC REGIONS SHARE IN INDIAS GLOBAL TRADE
  1.83.
• MAIN EXPORT DESTINATIONS TO LAC ARE BRAZIL,
  MEXICO, CHILE, ARGENTINA, VENEZUELA, COLOMBIA,
  PERU.

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INDO-LAC COMMERCIAL

• MAIN IMPORT SOURCES FOR INDIA ARE BRAZIL,
  ARGENTINA, CHILE, MEXICO IN THAT ORDER.
• OTHER DESTINATIONS WHICH NEED TO EXPLORED ARE
  COLOMBIA, VENEZUELA, PERU, T T, PANAMA.
• BASE OF INDIAN EXPORTS-IMPORTS TOO SMALL AND
  NARROW.

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INDIAS TRADE WITH LAC

• INDIAS TRADE (EXPORTS TO LAC)
• 1992-93 US 165.55 MILLION
• 2000-01 US 981.79 MILLION

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IMPORTS FROM LAC

• EDIBLE OILS
• RAW WOOL
• HIDES AND SKINS
• METALIFEROUS ORES AND METAL SCRAP
• NON-FERROUS METALS
• CRUDE MINERALS

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EXPORT FROM INDIA

• TEXTILES INCLUDING READYMADE GARMENTS, CARPETS
  AND HANDICRAFTS.
• ENGINEERING PRODUCTS INCLUDING COMPUTER SOFTWARE
  
• TWO WHEELERS AND THREE WHEELERS
• BICYCLES AND BICYCLE PARTS

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AN OPPORTUNITY FOR ENHANCING TRADE

• LIBERALISED GROWING AND HUGE ECONOMICS
• SIGNIFICANT GROWTH IN TRADE, PARTICULARLY INDIAS
  EXPORTS DURING 90s EVEN WITHOUT CONCENTRATED
  EFFORTS AND AGGRESSIVE PROMOTION

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FOCUSLAC

• FOCUSLAC LAUNCHED IN NOVEMBER 1997 BY THE
  COMMERCE MINISTER OF INDIA IN ORDER TO
  SIGNIFICANTLY ENHANCE INDIAS TRADE WITH THE
  LATIN AMERICAN REGION.

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FOCUS PRODUCT GROUP

• TEXTILES,
• ENGINEERING PRODUCTS
• CHEMICAL PRODUCTS INCLUDING PHARMACEUTICALS
• MACHINERY AND INSTUMENTS
• JEWELLERY

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FOCUS PRODUCT GROUP

• BULK DRUGS AND PHARMACEUTICALS
• DYES AND INTERMEDIATES
• PLASTIC PRODUCTS
• TYRES FOR BUSES, TRUCKS AND BICYCLES

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FOCUS PRODUCT GROUP

• AUTOMOBILES AND AUTO COMPONENTS
• ELECTRICAL MACHINERY
• HAND TOOLS
• MACHINE TOOLS

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FOCUS LAC PROGRAMME

• PROGRAMME BEING CONTINUED TILL MARCH 2003 WITH
  COORDINATED EFFORTS OF
• DEPT OF COMMERCE, GOI
• ITPO and APEX CHAMBERS
• EXPORT PROMOTION COUNCILS
• INDIAN MISSIONS IN LAC
• INSTITUTIONS SUCH AS EXIM BANK, ECGC, ETC.

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MEASURES BY GOVT.

• PREPRATION OF TRADE ANAYLSIS UP TO EIGHT DIGITS
  THOUGH NCTI
• ENHANCED INTERACTION INCREASED FREQUENCY OF
  INTERACTION AT THE HIGHEST LEVEL WITH IMPORTANT
  TRADING PARTNERS
• ACTIVATION OF INSTITUTIONAL MECHANISMS WHICH
  ALREADY EXIST SUCH AS BUSINESS COUNCILS.

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TRADE PROMOTION MEASURES

• LIBERLIZED GUIDELINE FOR MARKET DEVELOPMENT
  ASSISTANCE
• SUPPORT FOR SALES-CUM-STUDY TOURSMDA FOR
  ADDITIONAL TOURS TO LAC INCREASED FROM ONE TO TWO
  AND CONDITION OF 5 INCREASE IN EXPORTS FOR
  SECOND TOUR WILL NOT BE APPLICABLE
• SUPPORT FOR PARTICIPATION IN FAIRS/EXHIBITIONS

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UPTO 90 OF THE COST OF BUILT UP STALLS ALONGWITH
INTERNATIONAL AIRFARE IN ECONOMY EXCURSION CLASS
IF ELIGIBLE.UPPER CEILING RS. 1.40 LAKH PER
EXPORTING COMPANY PER EVENT.APPLICABLE FOR
APPROVED MDA ACTIVITES.
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TRADE PROMOTION MEASURES

• SUPPORT FOR MARKET SURVEYS TO EPCs RAISED FROM
  60 TO 80 ON MARKET SURVEYS IN LAC
• EXPENSES ON TRANSLATION INTO SPANISH/PORTUGUESE
  AND VICE-VERSA FROM MDA
• PROVIDED FOR SPECIALISED MADE IN INDIA EXHIBITION
  IN LAC ON CASE TO CASE BASIS.

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TRADE PROMOTION MEASURES

• CONTD..
• MDA GRANT AVAILABLE FOR HIRING OF WAREHOUSING
  FACILITYFOR THREE YEARS COVERING 75OF THE TOTAL
  COST FOR IST YEAR AND 50 FOR THE SECOND YEAR AND
  25 FOR THE THIRD YEAR.
• SUPPORT AVAILABLE FOR INVITING BUSINESS
  DELEGATION FROM LAC

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TRADE PROMOTIONAL MEASURES

• REIBURSEMENT OF MDA ASSISTANCE TO INDIVIDUAL
  EXPORTERS FOR SALES CUM STDY TOUR, PARTICIPATION
  IN TRADE DELEGATIONS, PARTICIPATION IN
  INTERNATIONAL TRADE FAIRS/EXHIBITION/COUNCIL
  SPONSERS BSMs, PRODUCTION OF PUBLICITY MATERIAL
  WOULD BE CONSIDERED OPPROVED BY CEOs OF

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• EPCs/FIEO/COMMODITY BOARD ETC. AND NOW SUCH CASES
  WOULD NOT BE REQUIRED FOR PRIOR APPROVAL OF GOVT.
  OF INDIA

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ECGC COVER

• LOWER GRADING RESULTED IN HIGHER PREMIUMS FOR
  GETTING COMMERCIAL COVER
• ECGC REQUESTED FOR FREEQUENT UPGRADATION

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ROLE OF EPCs

• SHALL CARRY OUT MARKET SURVEYS AND DISSEMINATE
  INFORMATION TO THE MEMBERS
• SHALL ENCOURAGE MEMBERS TO PARTICIPATE IN
  SPECIALIZED FAIRS IN THE REGION
• SHALL PREPARE COMPENDIUM OF MAIN
  IMPORTERS/ASSOCIATIONS OF THE REGION

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ROLE OF EPCs

• SHALL BRING OUT PROMOTION LITERATURE IN
  SPANISH/PORTUGESE
• SHALL HOLD COMMODITY SPECIFIC SEMINARS/BUYER
  SELLER MEETS IN SELECTED INDUSTRIAL CENTRES

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OTHER MEASURES

• AIR INDIA REQUESTED FOR EXAMINING THE TRAFIC FLOW
  FOR DIRECT AIR-LINKAGE
• RBI REQUESTED FOR EXAMINING POSSIBILITY OF DIRECT
  CREDIT LINE, MONEY TRANSFER AND OPEINING OF BANK
  BRANCHES ETC.

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ROLE OF APEX CHAMBERS

• SHALL ESTABLISH AND STRENGTHEN TIES WITH THEIR
  COUNTERPART CHAMBERS
• SHALL HAVE FREQUENT EXCHANGE OF DELEGATIONS
• SHALL DISSEMINATE INFORMATION REGARDING POTENTIAL
  OF THE REGION TROUGH THEIR PUBLICATIONS/
  BULLETINS ETC.

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ROLE OF APEX CHAMBERS

• CONTD..
• SHALL ORGANISE SEMINARS/WORKSHOPS AT REGULAR
  INTERVALS SPECIALLY IN INDUSTRIAL CENTRES FOR
  WIDER COVERAGE

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ROLE OF INDIAN MISSIONS

• SHALL ORGANISE CATALOGUE/BROUCHURE EXHIBITIONS
• SHALL PLAY A PRO-ACTIVE ROLE IN COORDINATING
  PROMOTIONAL MEASURES LIKE ORGANISING BSMs, VISIT
  OF DELEGATIONS AND PARTICIPATION IN TRADE FAIRS

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ROLE OF INDIAN MISSIONS

• SHALL SEND PROCESSED/USABLE INFORMATION TO EPCs
  ON FOCUS PRODUCTS
• SHALL CARRY OUT MARKET SURVEYS IN COLLABORATION
  WITH ITPO AND EPCs

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FOCUS LAC-ACTION PLAN

• A COMPREHENSIVE QUARTERWISE ACTIVITY BASED
  ACTION PLAN HAS BEEN PREPARED FOR IMPLEMENTING
  THE PROGRAMME UPTO MARCH 2003 INVOLVING ITPO,
  FICCI, CII, ASSOCHAM, FIEO, EPCs AND OTHERS.

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NEW CHALLANGES

• TO IMPROVE QUALITUY OF PRODUCT
• TO IDENTIFY NEW MARKTS
• TO SUPPORT INTEGRATION AMONG SSI AND OTHER COs
• TO DEVELOP AND DIVERSIFY PRODUCTS AND INCREASE
  COMPETITIVENES
• TO USE SPECIALIZED CONSULTANTS AND SUPPORT
  SERVICES

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NEW CHALLANGES

• TO STRENGTHEN EXPORT SERVICES TELECOMMUNICATION,
  BANKING, CERTIFICATION.
• TO CREATE APPROPRAITE CONDITION FOR FLOW OF
  INVESTMENT AND EXPORT
• TO MODERNIZE AND REDUCE PAPERWORK IN CUSTOM
  PROCEDURES
• TO DEVELOP SERVICE PLATFORM

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LET US WORK TOGETHER

• GOVT OF INDIA POLICY IS TO OPEN AND ENCOURAGE
  EXPORT TO NEW MARKETS
• FOCUSED INITIATIVE ARE WELCOME FROM GOVTS OF LAC
  TOWARDS INDIA FOR FORGING BETTER BUSINESS TIES.