India’s commerce secretary, Rita Teaotia, has told the inaugural India-Commonwealth Small and Medium Enterprises (SME) trade summit that now is the time to look for ways to support investment, trade, employment and growth.
Representatives from three hundred Indian firms have come together with more than 100 businesses and high-level policy makers from across the Commonwealth in New Delhi for the two-day summit to enhance trade and investment partnerships.
Speaking at the plenary session, Commerce Secretary Teaotia said India remained deeply committed to open and fair trade. The summit, she said was a ‘win-win for all of us’.
“For the last two decades India has become more and more deeply integrated with the world economy,” Ms. Teaotia said. “We started as a fairly protected economy. We are today among the most liberal and open economies in the world. The share of trade to our GDP, which used to be around 20 per cent, has grown to more than 47 per cent. For most of the countries who are represented here, trade is a catalyst for development and we all subscribe to the idea that it needs to be inclusive and based on equity.”
Ms. Teaotia told delegates that India has been benefitting from a more open policy in trade since 1991. This year India’s economy is expected to grow by 7.5 per cent, she said, up by almost half a point from 2016. That was despite the government’s sudden decision last year to take large-denomination notes out of circulation.
Commonwealth Deputy Secretary-General Deodat Maharaj explained that there is a ‘Commonwealth advantage’ when Commonwealth countries trade with each other. The cost of trading, he said, was on average 19 per cent less.
“This huge potential has been left largely untapped,” he continued. “Intra-Commonwealth trade amounts to only 14 per cent of the total Commonwealth’s global trade. We at the Secretariat now aim to help increase this trade to around 25 per cent by 2020.”
Commerce Secretary Teaotia said that more than any other economic sector, small and medium enterprises (SME) faced ‘the brunt of the challenges in terms of regulations and standards and non-tariff measures which tend to diminish their effectiveness’ It is important to invest in SMEs, she continued, recognising that they create jobs and promote economic stability.
“The SME spans not just the traditional sectors, it also goes to the hi-tech areas. A very small example, India’s space missions, source some of the key components to satellite manufacturing from small enterprises. It is in this context that, as a country, we have been focusing on policy interventions, the tax frameworks, access to capital, access to technology as pertains to SME sector.”
The Commerce Secretary said the lack of trade facilitation and liberalisation were also negatively affecting the services industry. In March at the World Trade Organisation (WTO), India floated new proposals to loosen cross-border rules on, among other industries, financial services and telecommunications.
Ms. Teaotia said India also raised the issue at the recent Commonwealth Trade Ministers’ Meeting at Marlborough House in London. If there was agreement among Commonwealth countries to ease trading rules, then it would become ‘a major weapon in the hands of SME sector globally’, she said.
India believes there is a strong case for solidarity among Commonwealth nations. If that can be achieved, said the commerce secretary, India will look for ‘positive outcomes’ for trade facilitation and liberalisation at the WTO’s Eleventh Ministerial Conference in Buenos Aries in Argentina in December.
As he ended his contribution, Mr. Maharaj indicated that “greater SME collaboration across member states will be good for jobs, good for inclusive growth and good for the Commonwealth”