The five-year Foreign Trade Policy, to be unveiled on August 27, is expected to give incentives to Indian exporters to widen their global markets beyond the US, the EU and Japan in the face of the economic crisis in these key destinations.
Commerce and Industry Minister Anand Sharma, who apprised Finance Minister Pranab Mukherjee on Monday about the difficulties being faced by exporters, said: "We will be surely looking at market expansion because if the diversion and expansion of market is not there, we will not be able to respond to this challenge."
Talking to reporters after his meeting with Mr. Mukherjee, Mr. Sharma said the government can extend support but will not be in a position to generate demand in the western economies which are contracting.
India's exports are on a downslide since October 2008 and the average contraction has been around 30 per cent over the past nine months. The country's exports were about USD 169 billion in fiscal 2008-09.
Mr. Sharma indicated that the policy, which outlines the priority sectors as also the sops, would be focused on employment-generating areas like textiles, leather, gems and jewellery, and handicrafts.
These sectors are having a torrid time over the past nine months as their demand dried significantly in the US and the EU.