Dispensing with value addition will increase exports with Iran: FIEO

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SME Times News Bureau | 01 May, 2014
Welcoming the decision to dispense the minimum value addition for re-export of food, medicines and medical equipments to Iran, which have been imported against payment in Freely Convertible Currency, President, Federation of Indian Export Organisations (FIEO), M Rafeeque Ahmed has said that dispensing with value addition will increase exports and reduce trade deficit with Iran.

"Besides meeting the demand of the trade, the move will help in increasing exports in a big way in 2014-15," FIEO chief said in a press release Wednesday.

India's exports to Iran has already touched USD 4.56 billion in April - February, 2014 showing a 60 percent growth as against overall export growth of 4 percent.

India has more than doubled its exports to Iran in last 2 years benefiting from the Rupee payment mechanism, said Ahmed.

"Exports to Iran was mere USD 2.4 billion in 2011-12 and it has crossed USD 5 billion in 2013-14. Besides food products, India is exporting Pharmaceuticals, Machinery, Transport equipments , organic - inorganic chemicals, man-made yarns &fabrics, steel etc.," he added.

However, President, FIEO said that issues regarding remittance for opening of office in Iran and its recurring expenses, performance guarantee for bidding for projects in Iran and commission to agents for furthering the business needs to be addressed so that India can build on the opportunities.