India will soon implement new industrial policy aimed to strengthen businesses

Commerce and Industry Minister Suresh Prabhu Thursday said the proposed new industrial policy has been finalised and the new government would announce that. "We have finalised the industrial policy. I am sure that the new government will announce that soon," Prabhu said here at CII's Annual session 2019.

Though the ministry has sent the final proposal of the policy to the Cabinet, it was not taken up for consideration. It aims at promoting emerging sectors and modernising existing industries. It will also look to reduce regulatory hurdles, cut paperwork and support emerging and new sectors.

The ministry has planned to set up elaborate machinery including a steering committee for effective implementation of the policy. This will be the third industrial policy after the ones released in 1956 and 1991. It will replace the industrial policy of 1991 which was prepared in the backdrop of the balance of payment crisis.

Talking about increasing foreign direct investment (FDI) into India, he emphasised on the need to have a proper strategy to attract overseas inflows in greenfield as well as brownfield projects. "We are trying to bring in more FDI. FDI will come either in greenfield area or it could be through acquisition. So, we must prepare a strategy on both... We should target those companies that can invest because they have an investable surplus and same time, we must have a matching sectoral strategy wherein inbound investments can be absorbed," he said.

FDI in India during April-December 2018 declined by 7 per cent to USD 33.5 billion. Talking about trade with China, the minister said that for the first time, the trade deficit with China has declined by about USD 10 billion and India is working with them to further bridge this gap, which stood at USD 63.12 billion in 2017-18.

"Chinese companies are now moving out of the mainland and some may come to India. So, we are working with China," he said. He added that this is one of the most challenging times that the global trade is facing in the last several decades and India should be conscious of that.

Prabhu said people are questioning about the existence of the World Trade Organization (WTO) and "a loss of WTO would be a loss to the entire world". He also listed out steps which the ministry has taken to boost exports and further improve ease of doing business, particularly as the district level.

He said that in 2018-19, India's exports of goods and services would touch about USD 540 billion. The country's exports grew 8.85 per cent to USD 298.47 billion during the April-February period of 2018-19.

Further, he added that thousands of start-ups have been recognised by the ministry and it is also working on removing hurdles in their path to promote budding entrepreneurs. Talking about free trade agreements (FTAs), Prabhu said the ministry is in the process of preparing a template to negotiate future agreements by involving all concerned stakeholders.

The industry has raised concern that FTAs which was signed by India is not benefitting domestic players. On a question that ease of doing business is not visible on the ground, the minister said they are working at district levels to improve the business environment.

(With inputs from agencies.)