For The First Time, Indian Exports Surpassed Those Of Other Countries | FCI
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For The First Time, Indian Exports Surpassed Those Of Other Countries
MNS Indian Exports
19 April 2022

Despite the misery and doom that has engulfed the Ukraine conflict, India can rejoice. India surpassed its $400 billion export objective in March, moving it closer to becoming "Aatmanirbhar” (SELF-DEPENDENT). India appears to be exporting more high-value and value-added items this fiscal year, as engineering goods exports climbed by 50%.

For the first time, India's exports surpassed $400 billion, led by larger engineering items, electronics, and food solutions, with an additional $10-12 billion in merchandise projected transported in the final days of the fiscal year. According to figures available, published by RBI, exports are expected to have increased 37% this calendar year from last year's level of $291 billion, making this the quickest rate of growth since the growth seen in 2009-10 to the level of over 40%.

Government response and words of encouragement

The government was ecstatic with the increase in exports. "India set a lofty aim of $400 billion in merchandise exports, which it met for the first time. For this achievement, I salute our farmers, weavers, MSMEs, brands, and exporters. Honourable PM Narendra Modi tweeted.

"This is an important milestone in our Aatmanirbhar (SELF-DEPENDENT) Bharat path." Modi had extensive meetings with corporations and Indian delegations abroad last calendar year, pressing them to increase exports.

Despite the fact that the target for the following fiscal year is still being worked out, the commerce and industry minister stated that India is on pace to make considerable progress in the coming years. "Despite obstacles, it is a true monument to the sheer tenacity, perseverance, and functionality of our company owners, MSMEs, farmers, craftspeople, and dairy producers," he said.

The primary exports of India

Engineering exports hit a record high of nearly $107 billion this calendar year, according to the ministry, while electronics exports increased by 41% to $15 billion and farm exports surpassed $40 billion for the first time.

According to sources, the United States has seen a 47% increase, the UAE has seen a 65% increase, and Australia has seen a 94% increase among India's top export destinations.

How did the $400 billion predictions for 2021-22 come about? Will some of the benefits be offset by the high cost of imported energy?

The value of India's export shipments for the fiscal year 2021-22 surpassed $400 billion for the first time. This would result in a 41% increase in exports from the pandemic-affected year of 2020-21, giving India its best export growth rate since 2009-10.

What are the risks that Indian exports may face in the coming year?

Although India's direct trade with Russia is small, accounting for less than 1% of its total trade, the Ukraine-Russia conflict may open up new chances for Indian farm produce exports, particularly wheat and maize. However, this would be offset by a dramatic increase in India's energy import bill, as well as an increase in the cost of importing edible oils such as sunflower oil, which is dominated by the two warring nations. India imports 80% of its oil, and demand is expected to rise as the economy recovers, assuming the epidemic does not recur.

Though shipping and handling prices, container shortages, and re-alignment of trade routes around the Black Sea will be difficult to overcome, prompt governmental interventions could help open up more export options. First, a quick conclusion of the Free Trade Agreements currently being negotiated with nations such as the United Kingdom, Australia, and Canada might facilitate market access in these huge markets. Second, exporters are looking forward to the long-awaited revision of the Foreign Trade Policy for 2015-20, which has now been extended into the first few months of 2022-23 as well.

Third, it has been recommended to the government to include Special Economic Zones and industries like as pharmaceuticals, steel, and chemicals in the Remission of Duties and Taxes on Export Products (RoDTEP) Scheme, which began last year after a long wait. These could assist to balance out some of the more dramatic alterations in trading patterns that have resulted from the European crisis, such as a firming up of the COVID-induced inward-looking shift in states' attitudes toward globalisation.

Conclusion

While the trade deficit is expected to go up this year, it will still be significantly below the all-time high reached more than a decade ago.

While the growing trend in exports is positive, proactive steps like negotiating Free Trade Agreements and expanding the flagship export promotion scheme RoDTEP to include industries like iron and steel and medicines are likely to keep the momentum rolling.

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