The foreign direct investment (FDI) target for 2007-08 has been set at $25 billion, commerce and industry minister Kamal Nath said on Friday.
NEW DELHI: The foreign direct investment (FDI) target for 2007-08 has been set at $25 billion, commerce and industry minister Kamal Nath said on Friday.
Replying to a query at the National Conference on Foreign Trade Policy and Procedures organised by the Confederation of Indian Industry, he said “SEZs are here to stay”.
The minister explained that one needs land for industry and that it’s no different in the case of SEZs. “There are issues in land acquisition, which are being looked into,” he added.
While Nath said that the government would soon consider the SEZ applications filed before April 5, he did not indicate any time frame for processing the fresh applications. Following violence at Nandigram in West Bengal over SEZ land acquisition issue, an extraordinary group of ministers (E-GoM) had earlier this month put a ceiling of 5,000 hectares on the size of each SEZ. This triggered protests from various business houses including, Reliance Industries, which have plans of bigger SEZs.
The minister on Friday said that there are size constraints for SEZs in India, unlike in China where entire a province can be declared as SEZ. But, he said that “it’s the number of units that is important not the size.”
He added, “smaller the size of SEZs, the number of units would be more.” Only two days ago, Nath had indicated that a review of the decision to cap SEZ size was possible in the future. While 92 SEZs have already been notified, 50 of them are in various stages of implementation.
As for FDI flow into the country, it was $16 billion in the year 2006-07, up from $5.5 billion in the previous year. The net FII inflow into the country during 2006-07 was $12 billion.
He said while the government was focusing on infrastructure development to attract FDI, agricultural export too was one of the thrust areas. The country was keen to focus more on agricultural exports to China, he said. While agriculture makes up 10% of China’s GDP, the comparative figure for India is 24%, Nath said. “Agriculture must turn from subsistence to commerce,” according to the minister. Pointing out the difference in approach between China and India, Nath said, “China sells what it produces, but India produces what it sells”.
In line with the agriculture focus of the country, Nath pointed out that the government was promoting the idea of setting up food parks. Although the government is promoting food parks, it may not have a direct role in running them. The move to set up food parks is geared towards reaching out to 650 million people who depend on agriculture for a living.
The country’s exports of goods and services for 2006-07 was $196.23 billion. The trade deficit (for both goods and services) was $16.14 billion.
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