Report No. 61
Care necessary even in exports.- Even in the case of exports, care is called for so that the export of raw materials, specially those which are likely to be depleted without any chance or possibility of replenishment, is not encouraged unless that becomes absolutely necessary in the overall interests of our national economy and national economic growth. It is well-known that formerly raw materials exported from India other than those needed for immediate consumption in the foreign countries where they were exported, were quite often converted into manufactured products and finished goods and those manufactured and finished goods were imported into India for use and consumption in this country. The bitter experience in this regard in pre-Independence days is well known and has not yet been forgotten. Any student of India's economic history is aware of the baneful consequences of this two-way process in the export trade.
This is why our export and import trade has been under a strict system of control and licensing under the Import and Export (Control) Act, 1947, passed in March, 1947 on the even or attainment of Independence when a national Government headed by Jawaharlal Nehru was in power. The Act was of temporary duration in the beginning but has continued in force ever since. It is now more or less a permanent statute. In this connection, reference may also be made to the Foreign Exchange Regulation Act, 1947, its objective being to provide in the economic and financial interests of India for the regulation of certain payment, dealings in foreign exchange and securities and the import and export of currency and billion.
I may also refer to the Export (Quality Control and Inspection) Act, 1963 whose object is to provide for the sound development of the export trade of India through quality control and inspection-the aim is thus to boost the export part of foreign trade. All this shows that the Central Government and Parliament regard export trade more important than import trade in the nation's economy. Therefore, we must be very circumspect in extending the length of the course of import.
And while our national aim should be to boost and develop export trade, we should not unduly lengthen the course of export either for the simple reason that the power of the States in the field of sales tax should not be unnecessarily curtailed. If the goods manufactured in our country are of high quality and never go below the standard quality, then that itself will, increase the demand for such goods in foreign markets specially if such quality goods are produced having regard to the tastes and fancies of foreign buyers irrespective of the imposition of taxes on the sales or purchases of the goods before their export. In this view no unnecessary encroachment in the State field is required.