Government should control steel prices to boost Indian exports: FICO

Ludhiana, April 18, 2023: The Federation of Industrial & Commercial Organization (FICO) demanded uniformity in commodity prices from Som Parkash Minister of State for Commerce & Industry, Government of India. Gurmeeet Singh Kular President FICO submitted a written memorandum to Som Parkash demanded an immediate resolution to the below industrial issues.

Un-rational increase in Steel Prices:
The abnormal hike in the prices of steel and other raw materials has brought downstream manufacturers, particularly in the MSME sector, who are on the verge of closure. The MSME industry is unable to absorb the hike in prices of raw materials as buyers are not willing to provide corresponding increases in the prices of manufactured products. The irony of the matter is that based on the prevalent prices of raw materials, exporters are seeking orders which generally fructify between 15 to 20 days, and in the meantime, prices go up substantially resulting in huge losses to such MSME exporters.

Today Indian MSME Exporters are unable to fetch orders, as there is a huge difference in prices of Steel in India when compared to that of China. In the given situation, the MSME sector needs to be provided with steel and other raw materials at a reasonable price so that export competitiveness of value-added products is maintained.

Import Duty on Machinery:
This is in line with the Honorable Prime Minister Shri Narendra Modi’s vision of Make in India, We, on behalf of all the MSME manufacturers, would like to request that the government must remove the import duty from machinery that is not being manufactured in India. The industrialists must be allowed to get international technology in shape of machinery, so that the items being imported to India, can be manufactured in India. Hence, benefitting the Indian Economy many folds.

CLCSS (Credit Linked Capital Subsidy Scheme):
Credit Link Capital Subsidy Scheme has been introduced to facilitate technology up-gradation in MSMEs by providing an upfront capital subsidy of 15 percent (on institutional finance of up to Rs.1 crore availed by them) for induction of well-established and improved technology. The government of India has suspended the scheme.  We demand that Credit Link Capital Subsidy Scheme should be made permanent as it is the only scheme for the up-gradation of the MSME industry with institutional finance of up to Rs.5 crore.

Fund Scheme for Upgradation of MSME:
The Technology Upgradation Fund scheme should be introduced for the MSMEs, who are working on age-old methods and techniques, which need to be technologically upgraded so that the industry gets the benefits up to 40 Crores.  So, Industries can upgrade themselves, manufacture global standard products and competitive prices, and supply to the world.

International Co-operation Scheme:
International Co-operation (IC) scheme which used to facilitate the industry for their visits to international exhibitions and conventions to upgrade themselves with the latest technology and trends being used worldwide, has been revised. Now, The International Cooperation scheme is benefitting the MSMEs who exhibit their products at International Exhibitions and Conventions, it is requested that new schemes/ guidelines should be introduced to benefit the MSME manufacturers who want to visit International Exhibitions and Conventions.

Freight Equalization Subsidy:
There should be a freight subsidy for the north Indian exporters who have been far away from the seaports so that they should also be able to maintain competitiveness with those who are located near to the seaports. Government must empower the indigenous manufacturers to compete globally, not within India.

Regulatory Body to control the Commodity Prices:
The prices of the commodities & non-ferrous items such as nickel, titanium, chromium, aluminum, copper, zinc, etc. ate uncontrolled, there is a need for a regulatory body to control these prices and ensure the rationality of prices in the country to encourage the Indian MSME Manufacturers.

PLI Schemes:
The Production Linked Incentive Schemes or the PLI schemes are benefitting the anchor units. Punjab is a land of MSME Exporters, with the benefits of PLI Schemes to the anchor units, the MSME ancillaries, and the MSME Exporters will become unviable in the market. It is requested that the PLI benefit schemes must also be introduced for the MSME Exporters.