Having set an bold purpose to ship out merchandise value $400 billion in FY22, India is firming up plans to bolster its exports of scores of key merchandise the place its share within the international market has historically remained paltry.
Mechanical equipment, electronics, medical and surgical tools, sports activities items, toys and sure farm commodities are amongst numerous merchandise the place India has the scope to considerably increase its exports, in accordance with an evaluation by exporters’ physique FIEO.
For example, within the electrical and electronics segments, India accounted for less than 0.5% of the worldwide provides of $2,900 billion within the calendar 12 months 2020.
Equally, whereas international imports of mechanical equipment and components stood at $2,142 billion in 2020, India’s exports have been simply $18 billion, with a share of underneath 1%.
In fact, India’s exports have risen at a quicker tempo than the worldwide common in such capital and client items within the final 5 years, it was aided by a low base. FIEO’s evaluation is a part of its broader train to plan new technique to enhance exports.
Importantly, the rollout of production-linked incentive schemes for electronics merchandise final 12 months will assist bolster our manufacturing base, which is able to in the end assist outbound shipments, FIEO reckons.
In medical & surgical tools, in opposition to international imports of near $592 billion in 2020, India’s exports have been solely to the tune of $3.1 billion. In sports activities items and toys, India’s exports stood at simply $380 million, in opposition to the worldwide provides of $120 billion in 2020.
As such, India’s exports have trailed the worldwide common within the final 5 years by means of 2020. Whereas international imports grew at a compounded annual development charge (CAGR) of three% throughout 2016-2020, India’s exports rose at solely 2%. In fact, the outbreak of the pandemic and consequent lockdowns impacted India extra adversely than most others in 2020.
Nonetheless, what’s a matter of concern is that exports from labour-intensive sectors are dropping their share within the international market. Within the gems & jewelry sector, international imports within the final 5 years by means of 2020 grew by CAGR of 5%, whereas India’s exports contracted by a CAGR of 12%.
Equally, whereas the woven garment imports worldwide remained static throughout 2016-2020, India’s provides shrank by a CAGR of 8%. Within the leather-based footwear sector, during which international imports grew by a CAGR of 1% throughout 2016-2020, the nation’s exports contracted at a CAGR of seven%.
Nonetheless, in sure farm commodities, similar to espresso, tea, spices, preparation of meat & fish, preparation of meals & greens, India’s CAGR in exports has been greater than the double that of world imports between 2016 and 2020. Right here the nation must construct upon what it has achieved in recent times.