Jamnagar in Gujarat tops the list of exporting districts in India, contributing about 24% of India’s exports in value terms in FY23 (till January). Other significant contributors include Surat in Gujarat and Mumbai Suburban in Maharashtra, each forming only about 4.5% of the country’s total export during the same period.
Listed among the top 10 are Dakshina Kannada (Karnataka), Devbhumi Dwarka, Bharuch, Kachchh (all in Gujarat), Mumbai (Maharashtra), Kancheepuram (Tamil Nadu) and Gautam Buddha Nagar (Uttar Pradesh).
Status of the Export Sector in India
The merchandise trade deficit in India increased by over 39% in 2022-23 to USD 266.78 billion from USD 191 billion in 2021-22. While imports soared by 16.51%, exports grew by a smaller magnitude of 6.03%. However, the overall trade deficit stood at just USD 122 billion, thanks to the surplus from trade in services.
Major Export Arenas in India
Exports of engineering goods have seen a robust growth of 50%, totaling USD 101 billion in FY22. Production units for pumps, tools, carbides, air compressors, engines, and generators are being shifted to India in increasing numbers.
India is also a major global supplier of agricultural products, boosted by the government’s initiatives to meet global food demand amid the pandemic. In fact, India’s rice export is valued at USD 9.65 billion, the highest among agricultural commodities.
In the textile industry, Apparel exports, bolstered by the government’s Mega Integrated Textile Region and Apparel (MITRA) Park scheme, reached USD 44.4 billion in FY22, marking a 41% YoY growth.
Pharmaceuticals and Drugs industry also play a significant role, with India being the third-largest producer of medicines by volume and the biggest supplier of generic drugs.
Challenges Related to Export Sector
Indian exporters face various challenges such as access to affordable finance, limited diversification of exports, rising protectionism, and deglobalisation. Issues include high interest rates, rigid collateral requirements, limited credit availability, concentration of exports in few sectors, and global political disruptions affecting India’s export capacities.
Way Forward
Improvements in infrastructure and logistics are critical for enhancing India’s export competitiveness. Investment in transportation networks, ports, customs clearance processes, and export-oriented infrastructure can lower transportation costs, improve supply chain efficiency, and boost export capabilities.
Furthermore, skill development programs can enhance the availability of skilled labor in export-oriented industries. Adoption of technology, such as automation, digitization, and Industry 4.0 technologies can increase productivity, competitiveness, and innovation in the export sector.
Joint development programs with other countries in sectors like space, semiconductor, solar energy can catalyze India’s medium-term growth prospects.
Previous Year Questions in UPSC Civil Services Examination
Among several others, questions related to ‘closed economy’ (2011), objectives of the SEZ Act, 2005 (2010), and higher level of economic development (2018) have been asked in previous year UPSC Civil Services Examinations.
