Recent Trends in India’s Foreign Trade

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Recent Trends in India’s Foreign Trade Presented By: Indransh Gupta Kunal Modi

Transcript of Recent Trends in India’s Foreign Trade

Recent Trends in India’s Foreign Trade

Presented By:Indransh Gupta

Kunal Modi

What is Foreign Trade Policy?

• Union Commerce Ministry, GoI announces integrated FTP

every five year also called EXIM policy.

• policy updated every year with some modifications & new

schemes.

• FTP which was announced on August 28, 2009 is an integrated

policy for the period 2009-14.

Foreign Trade Policy 2009-14

Short Term Objectives:• arrest and reverse the declining trend of exports. • provide support to those sectors which have been hit badly by recession.

Medium term Policy Objectives :• achieve an Annual Export growth of 15% by March 2013. • achieve Annual Export growth of around 25% by 2014.

Long Term Objective :• doubling India’s share in Global Trade by 2020.

Targets

• Export Target : $ 350 Billion for 2012-13

• Export Growth Target: 15 % for next two year and 25 % thereafter.

Import/Export Controls

IMPORTS:

• Around 5% Tariff Lines are under Import Controls.

• 11600 Tariff Lines are free for import.

• Restrictions removed over the next 10 years, removing almost all the

Quantitative Restrictions.

• Presently:

Prohibited items - 53 Lines

Restricted items - 485 Lines

State Trading Items - 33 Lines.

Import/Export ControlsEXPORTS:• Controls primarily on account of security, public health, morals,

exhaustible resources and environment grounds. Prohibited items - 59 Restricted items - 155 State Trading Items - 12

• Restrictions fall under two Categories:- Special provision for these items under Weapons of Mass Destruction

Act, 2005. Export Facilitation Committee looks into applications for license for

these items.{Special chemical ,organisms, materials, equip. & tech.}

Highlights

• Q1 of 2012-13, exports stood at US$ 75.2 bn and showed a

decline of 1.7 per cent as against an increase of 36.4 per cent

during Q1 of 2011-12.

• Q1 of 2012-13, imports declined by 6.1 percent over the

corresponding quarter of 2011-12 and stood at US$ 115.3 billion.

• Lower growth in POL imports at 5.5 percent during Q1 of 2012-

13 as compared with 52.5 percent during Q1 of 2011-12.

Highlights

• Imports of gold and silver, US$ 9.4 bn during Q1 of 2012-13

were 48.4 per cent lower than that in Q1 of 2011-12.

• Non-oil non-gold imports during Q1 of 2012-13 at US$ 65.3

bn recorded a decline of 2.9 per cent as compared to an

increase of 18.9 per cent in Q1 of preceding year.

• Trade deficit during Q1 of 2012-13 stood lower at US$ 40.1

bn as compared with US$ 46.2 bn during Q1 of 2011-12.

India’s Foreign Trade•growth is uncertain in coming months, given the worsening global

macroeconomic outlook and high interest rate in the domestic market.

•During April-Sept 2011, India's imports expanded by 32.4% to $ 233.5

billion. The trade deficit during the April-Sept’ 2011 period stood at $ 73.5

billion. Increasing Trade Deficit further depreciates Rupee.

•depreciation of rupee will also push up cost of imports leading to wider

trade deficit in coming times.

Export/Import Share of India as (%) of GDP

Exports of Principal Commodities

Imports of Principal Commodities

India's Exports to Principal Regions

India's Imports from Principal Regions

India’s Foreign Trade

Last 10 Years India’s Export/Import Performance

Composition Of India’s Foreign Trade

• Composition of Exports

Agricultural and Allied Products

• 15% share in exports• Top items of agricultural exports include: - Fish Products - Rice - Oil Cakes - Fruits and Vegetables

Ores and Minerals

• 12.3% share in exports.

Manufactured Goods• 61.3% share in exports.- Include: Engineering Goods Gems and Jewellery Chemical and Allied Products Readymade Garments

Minerals Fuels and Lubricants

• 18.3% share in exports• There has been improvement in the exports of mineral

fuels and lubricant both in terms of value and in terms of %.

Composition of Imports

• Petroleum Products 31.7% share in Imports.• Capital Goods 20.3% share in Imports.• Pearls and Precious Stones 6.2% share in Imports.• Iron and Steel 2.4% share of Imports.• Fertilizers 2.4% share of Imports.

Conclusion

Composition of India’s Foreign Trade has undergone a positive change. It is a remarkable achievement that India has transformed itself from a predominantly primary goods exporting country into non primary goods exporting country. Under Imports also India’s dependence on food grains and capital goods has declined.