Despite turmoil in global economy, India’s exports to cross $750 billion in 2023
India’s merchandise exports rose to $37.3 billion in February 2023, an increase of 28.2% from the same month in 2022--the highest monthly exports ever recorded in the country’s trade history.
“We are inching close and marching ahead to cross $750 billion of goods and services exports in 2022-23. We are expanding rupee trade with several countries, many of which are at an advanced stage of dialogue and finalization,” Commerce and Industry Minister Piyush Goyal said at the CII partnership summit in New Delhi on Monday. Earlier, exports used to hover at around $ 500 billion every year, he added.
The Minister attributed exponential growth in exports to a deep-dive analysis and extensive planning where India’s capabilities were thoroughly assessed, new markets were sought, remote districts were empowered to become export hubs and all Indian Missions abroad were effectively leveraged to promote trade, technology, and tourism. Launch of ‘Make in India’ programme in 2014, promotion of the domestic manufacturing sector and due encouragement for foreign investments have also played a significant role in the growth of exports.
The Ministry of Electronics and Information Technology revealed that the electronics manufacturing sector alone has seen an increase in exports by 25% in the last fiscal year, reaching $26.5 billion. Other sectors that have seen growth in exports include the pharmaceutical industry, which saw a 22% increase in exports in the last fiscal year, and the automobile industry, which saw a 23% increase in exports.
India has set a $1 trillion goal for merchandise exports in 2027–2028 to make the country a $5 trillion economy. For this, the government has been actively promoting e-commerce exports and providing various incentives to boost the sector. Union Budget 2023-24 also introduced a slew of measures to increase exports and help accelerate growth of manufacturing in the country.
Indian exports majorly included: Pearls, precious and semi-precious stones and jewelry, mineral fuels, oils and waxes and bituminous substances, vehicles, parts and accessories; nuclear reactors, boilers, machinery and mechanical appliances, pharmaceutical products; and organic chemicals.
In 2021, the government launched the National Single Window System (NSWS), which aims to streamline the export process for traders and businesses by providing a single digital platform for approvals and clearances. This portal has integrated multiple existing clearance systems of the various ministries/departments of government and state governments to enhance the investor experience.
Other measures focused on the ease of doing business in India have also been launched under the ‘Make in India’ program. Fresh, IT-driven application and tracking processes are replacing files and red tape. From amendments in labor law to online filing of returns & from rationalization of the regulatory environment to increasing the validity of industrial licenses, a lot of changes have been ushered in to make ‘Make in India’ a reality.
As a result, India's rank in the World Bank's Ease of Doing Business Index has improved from 142 in 2014 to 63 in 2020, indicating significant reforms in regulatory and administrative processes.
Some of the initiatives taken by the government to promote exports include:
● Export Promotion Capital Goods (EPCG) scheme: This scheme provides exporters with incentives for importing capital goods for production purposes.
● Production Linked Incentive (PLI) scheme: This scheme provides incentives to manufacturers in various sectors, including electronics, pharmaceuticals, and automobiles, among others.
● National Trade Facilitation Action Plan: This plan aims to simplify and streamline trade procedures to reduce transaction costs and improve competitiveness.
● Trade Infrastructure for Export Scheme (TIES): This scheme provides financial assistance to states for developing infrastructure to promote exports.
● Trade Receivables Discounting System (TReDS): This digital platform helps small and medium-sized enterprises (SMEs) access working capital by allowing them to sell their trade receivables at a discount to banks and other financial institutions.
● Electronic Negotiable Warehouse Receipts (eNWR) system: This digital platform allows farmers and traders to store and transfer their agricultural produce through an electronic warehouse receipt.
● Market Access Initiative (MAI): This scheme provides financial assistance to exporters for market research, product development, and marketing.
● e-Sanchit: This is a digital platform for filing and processing documents related to exports and imports.
● Foreign Trade Policy: Through these incentives and supports are provided to exporters to increase exports and enhance the competitiveness of Indian products in the global market.
These initiatives have helped India become a global manufacturing hub and boosted the country's exports. The government hopes it will continue to drive growth and create employment opportunities in the country. Based on the vision of the ‘Make in India initiative’, the ‘One District One Product’ initiative has also increased the exposure of artisans and manufacturers of handlooms, handicrafts, textiles and agricultural processed products.
Praising the success of the 'Make in India' program, Prime Minister Narendra Modi stated that it has helped India become a “global leader in several sectors.” He urged businesses to continue to invest in the country and take advantage of the various incentives provided by the government.
In line with this, India has signed various free trade agreements (FTAs) with countries like the UAE, Australia, UK, Canada, EU, Israel and more, to boost its international trade and economic relations.
These agreements aim to reduce trade barriers and promote economic cooperation between India and its partner countries. These FTAs have helped the country to increase its trade and investment with partner countries and have also provided opportunities for Indian businesses to expand their reach in foreign markets.
Thus, the strong export growth seen in recent years is a testament to the success of the 'Make in India' digital drive and other initiatives by the government to promote domestic manufacturing and exports. With these initiatives at the forefront, the businesses in India are aiming that the products that are 'Made in India' are also ‘Made for the World,’ adhering to global standards of quality.
***The author is a Mumbai-based journalist; views expressed are her own