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OVERSEAS PROJECTS
PROJECT EXPORTS
Project, executed on turnkey basis or otherwise, in any sector
of economic development involveactivities like engineering,
procurement, construction (civil, mechanical, electrical
orinstrumental), including provision of all desired and specified
equipment and / supplies,construction and building materials,
consultancy, technical know-how, technology transfer,design,
engineering (basic or detailed), commissioning with other all such
related services as areneeded by the existing or new projects /
plants / processes involving international competitivebidding (thus
including even Multilaterally Funded Projects in India).
In the global market India ranks 12th and accounts for 1.75% of
the $3.4 trillion global market as
far as construction sector is concerned. The construction
sector, in India, accounting for 5% ofthe GDP, is the second
highest employer after agriculture, employing directly or
indirectly 32million workers. The construction sector accounts for
a gross annual business volume of Rs.230,000 crores.
Project exports therefore have occupied an important place in
India's export portfolio,particularly after the early seventies
when the construction sector in the oil-exporting region ofthe
Middle East underwent a spurt of activity. The thrust of India's
project export bids during lastfive years has exhibited a
significant shift towards cash-terms projects, and Multilaterally
fundedProject Overseas (MFPO). There is also a growing emphasis on
competitive pricing, and anaggressive strategic marketing for
securing contracts. The contracts secured in the recent years
have been quite diverse in nature, indicating the growing
versatility and technologicalcapabilities of Indian project
exporters. The following regions continue to be potential
marketsfor Project Export Sector:
SAARC Region
Asia [South/East/West (Afghanistan)]
Africa
Middle East
Russia & CIS Countries
Latin American Countries
India's overall project exports overall have shown a steady
trend in the recent past. Details of thevalue of contracts secured
in respect of civil construction and turnkey projects and
consultancyservices during the last 3 years and April - Feb 2004
are as under :
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PERFORMANCE OF PROJECT EXPORTS
(VALUE IN US$ MILLION)
Source:
(i) Overseas Construction Council of India (OCCI) for civil
contracts.
(ii) Exim Bank for Turnkey Projects and consultancy project.
(The above figures represent only the value of contracts
secured)
The Overseas Construction Council of India acts as a focal point
for channelisation ofinformation and identifies Indian companies
capable of executing projects in overseas markets.
Promotional Measures and incentivesMarket Development Assistance
(MDA) given by the Department of Commerce to ExportPromotion Bodies
/ Individual Exporters to undertake various export promotional
anddevelopmental activities as prescribed in the MDA Code has been
revised to make it moreexporter-friendly. Reserve Bank of India
(RBI) has revised the Project Exports Manual (PEM)thereby
simplifying export procedures to promote project exports.
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FUTURE PROSPECTS
Experience gained by Indian firms through participation in
domestic projects of a diverse varietyis relevant to the needs of
other developing countries. Scope exists to initiate our presence
in newmarkets, and cover new sectors. The recent trends observed in
the pattern of bidding by Indian
project exporters are encouraging particularly for project
opportunities in neighbouring and otherdeveloping countries. Indian
project exporters' technical and managerial capabilities are of
thehighest order in the world market. Indian project exporters are
hopeful of penetrating newoverseas markets to secure increased
share in project exports.
Source:
(I) Overseas Construction Council of India(OCCI) for civil
contracts.
(ii) Exim Bank for Turnkey Projects and consultancy project.
