The Ministry of Commerce and Industry has recommended to the Reserve Bank of India (RBI) to consider the entire export sector under priority sector lending in order to promote exports of goods and services from India, said Union Minister of Commerce and Industry Suresh Prabhu, at event in Mumbai recently.
"Exports is a strategic issue which promotes India's interest and therefore it is a strategic priority for India (but) not a priority sector lending for banking sector. This is a complete paradox," he said.
This is not a commercial banking problem, but the one related to the regulator, he said adding, "I have already told the RBI Governor that you must treat exports as priority sector lending."
"Banking is a very important issue and we must address it and we will continue to work on it and make sure that the genuine credit requirements of the sector are met," the Minister added.
Treating exports under the priority sector lending will help India achieve the target of becoming a USD 10 trillion economy by 2035 amid the current operating environment, Prabhu said.
With joint efforts of the Government, industry and other stakeholders, India will definitely be able to become a 5-trillion dollar economy within 7-8 years, he said adding, "India will become a 10 trillion dollar economy by 2035."
"We want to grow at a rate which is closer to 8-9 per cent, and it can't be done without global trade...this is the first time that world trade itself is facing fundamental challenges...the entire edifice of WTO has been challenged, and that the future of the institution is in crisis.
"This raises the need for us to chart a path forward, based upon international trade as a key driver," Prabhu said.
He said India's exports in last fiscal were the highest in the last six years and have been growing at a higher rate in the last few months.
"I think we are now growing at over 20 per cent. If we continue this, India may be able to again register record growth in exports this fiscal as well," he added.