Empowering MSMEs with News & Insights

Urgent need to recognize retail e-commerce exports as an industry, remove regulatory barriers: Study

Updated: Jun 05, 2017 10:29:36am
image

Urgent need to recognize retail e-commerce exports as an industry, remove regulatory barriers: Study

New Delhi, June 5 (KNN) Global platforms like eBay, Amazon and Alibaba are engaging with MSMEs to push their products in global markets by helping them list on their respective platforms, highlights a study.

According to the study 'Exploring Potential of E-Commerce for Retail Exports of Indian MSMEs in Manufacturing Sector', “to provide a fillip to MSME exports through ecommerce there is an urgent need for the government to recognize retail ecommerce exports as an industry and work towards removing regulatory barriers including reviewing the FTP policy, enhancing limits for gems and jewellery, simplifying customs duty procedures and allowing exporters to claim duty drawbacks.”

The study was conducted by FICCI and IIFT.

According to it, assessments indicate that if India can target around 250,000 MSMEs moving into CBT space in the next four years, it can successfully list at least a 100,000 MSMEs with five million products and can increase four times the existing CBT revenue in B2C category.

(There are no official figures available on the actual CBT and B2C categories. Informal Discussion with major players suggest that it is around 500 million.)

India’s overall export (merchandise) today stands at USD 302 billion, contributed by 93 product categories and exported to 159 countries. However, products like petroleum, machinery, iron and steel, etc. cannot be addressed through B2C ecommerce exports.

The addressable retail export through B2C ecommerce is only USD 52 billion, contributed by only 20 product items like gems and jewellery, finished leather goods, handloom products, handicrafts, auto accessories etc.

There are many clusters in India that have tremendous supply and opportunities for such products that can be exported to countries in North America (USA), Europe (UK, Germany, Italy and France), Australia and South East Asia countries (Thailand, Singapore, Philippines and Malaysia).

Meeting the MEIS target of reaching exports to the tune of USD 900 billion by year 2020 will require extensive product and market diversification to be undertaken. Appreciating the tough international competition, Indian MSMEs will need to move from selling old products to existing trade partners, towards developing a range of contemporary products that target both existing trade partners as well as potentially new ones, says the study.

Indian MSMEs will also need to support this with expanding from traditional styles of marketing to new ways of doing B2B business via e-commerce to ensure competitiveness.

To facilitate this transformation, import trends of identified markets with high e-commerce potential were examined. Details of the analysis are presented in the following sections including identification of target sectors. Given that current business processes in these sectors are predominantly done in an offline mode, the possibility of shifting towards online B2B and B2C was assumed to be high, considering high internet penetration in these markets. Resultantly, global markets where import demand exist, and where imports from India hold a reasonable share of the total imports in the sector, were prioritized as the most prospective market for Indian e-commerce exports. (KNN Bureau)

COMMENTS

    Be first to give your comments.

LEAVE A REPLY

Required fields are marked *