OVERSEAS PROJECTS

PROJECT EXPORTS
Project, executed on turnkey basis or otherwise, in any sector of economic development involve activities like engineering, procurement, construction (civil, mechanical, electrical or instrumental), 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 are needed by the existing or new projects / plants / processes involving international competitive bidding (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% of the GDP, is the second highest employer after agriculture, employing directly or indirectly 32 million 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 of the Middle East underwent a spurt of activity. The thrust of India's project export bids during last five years has exhibited a significant shift towards cash-terms projects, and Multilaterally funded Project Overseas (MFPO). There is also a growing emphasis on competitive pricing, and an aggressive strategic marketing for securing contracts. The contracts secured in the recent years have been quite diverse in nature, indicating the growing versatility and technological capabilities of Indian project exporters. The following regions continue to be potential markets for 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 the value of contracts secured in respect of civil construction and turnkey projects and consultancy services during the last 3 years and April - Feb 2004 are as under :

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 of information and identifies Indian companies capable of executing projects in overseas markets.

Promotional Measures and incentives

Market Development Assistance (MDA) given by the Department of Commerce to Export Promotion Bodies / Individual Exporters to undertake various export promotional and developmental activities as prescribed in the MDA Code has been revised to make it more exporter-friendly. Reserve Bank of India (RBI) has revised the Project Exports Manual (PEM) thereby simplifying export procedures to promote project exports.

FUTURE PROSPECTS
Experience gained by Indian firms through participation in domestic projects of a diverse variety is relevant to the needs of other developing countries. Scope exists to initiate our presence in new markets, 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 other developing countries. Indian project exporters' technical and managerial capabilities are of the highest order in the world market. Indian project exporters are hopeful of penetrating new overseas 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.