There is a need for a re-look at burdening a brilliant and effective cabinet minister like Piyush Goyal with multiple heavy portfolios.
‘Railways’ is a busy portfolio. Suresh Prabhu was spending a lot of energy and initiative in revamping Indian Railways. Unfortunately, due to a spate of accidents, he was moved out of Rail Bhavan. With his excellent track record in the power ministry, Goyal continued the good work done by Prabhu. But loading him with two heavyweight portfolios of commerce and industry appears unwise.
After a few years of stagnant exports, there were green shoots last year: exports recorded $331 billion during 2018-19. With global trade stagnant, there is a need for plenty of efforts to goad business to build volumes and look for opportunities spread across the globe. Likewise, the industry has also been recording poor growth quarter after quarter. It needs all the dynamism to look at issues of stimulating growth, encouragement to build volumes and looking for new and emerging markets.
I cite a couple of instances of the potential that exists but remains untapped.
India produced a record 329.5 lakh tonnes of sugar in 2018-19 sugar season. It has a large surplus after meeting its annual domestic demand of around 260 lakh tonnes. The industry has been in distress through huge arrears of payments to cane growers and has been struggling to manage liquidity problems. The mounting stocks and fall in retail prices add to the miseries. What is needed is a concerted effort to look for opportunities for export.
I find such opportunities do exist. China imports sugar in large quantities at reasonable prices. We have a severe trade imbalance with China.
Prospects for Sugar exports
In a discussion with an Indian businessman, I found our lacking in efforts to meet this demand. A couple of reasons that appear solvable were cited. One is the reluctance of the Indian sugar producer to commit large quantities for exports. For instance, if the importer requires 50,000 to 100,000 tonnes, our mill owners are content to quote for 5000 tonnes. This involves higher costs of packaging and freight. The government can help agglomerate, build volume and export to profit.
I found a similar opportunity in the Philippines, which imports sugar in sizable quantities. The retail price of sugar in Manila is more than three times the retail price in India.
And for milk too…
Similar prospects exist for the export of milk and milk products. The Philippines imports these from far away from Europe as also from Australia, New Zealand and Singapore. India, as the largest producer of milk, can work on a policy for earmarking specific volumes for exports on a sustained basis. The difficulty here relates to milk handled by different state milk marketing federations, which are mostly cooperatives that lack in the wherewithal to look at global opportunities.
Prime Minister Narendra Modi would do well to entrust industry and trade to the hands of technocrats with hands-on experience. There is a need for a re-look at burdening even a brilliant and efficient cabinet minister like Piyush Goyal with multiple heavy portfolios.