India's diversification of export markets increases: Report
Updated: Nov 05, 2014 01:48:23pm
New Delhi, Nov 5 (KNN) India’s diversification of export markets has been increased as concentration of exports towards the top 10 export destinations declined from 56 per cent in FY2004 to 53 per cent in FY2009 and to 49 per cent in FY2014.
This was stated by President, PHD Chamber, Sharad Jaipuria, who added that India’s exports are no more majorly dependent on its traditional export destinations as volumes of exports towards African and Asian markets are increasing, according to an official release.
According to the PHD Research Bureau which has compiled data from the Ministry of Commerce and Industry, the region-wise percentage share in India’s exports is: EU countries (FY2004 – 22.7 and FY2014 – 16.4); Southern African Customs Union (FY2004 – 0.9 and FY2014 – 1.7); North America (FY2004 – 19.6 and FY2014 – 13.8); ASEAN (FY2004 – 9.1 and FY2014 – 10.5); West Asia-GCC (FY2004 – 11.1 and FY2014 – 15.3)
India’s export performance has exhibited remarkable performance during the last decade. At the time of commencement of reforms India’s exports were only of around USD 20 billion which increased to USD 45 billion in 2001-02 and to USD 312.6 billion in 2013-14. Thus, during the early phase of reforms it took as many as 10 years (FY1992- FY2002), to double the exports, however, within next 12 years (FY2003-FY2014) the exports increased nearly by six times, said Jaipuria.
Further, India‘s integration with the world economy, reflected by the trade openness indicator (merchandise trade to GDP) is also enhanced from 14.3 per cent of GDP in 1991-92, to 28.2 per cent in 2004-05 and further to 41.8 per cent of GDP in 2013-14. And, the share of India‘s merchandise exports in the world exports has been increased from 0.5 per cent in 1991 to 0.8 per cent in 2004 and to 1.7 per cent in 2013, he said.
However, despite exhibiting encouraging exports growth, India’s exports performance at the international stage is still not that much significant and suggests lot of scope to excel further with increased share in world exports, said Jaipuria.
This is apparent in the recent World Trade Report, 2014 of WTO wherein, India with total exports of around USD 313bn and 1.7 per cent share in world exports is ranked at the 19th position amongst the World’s top 20 leading exporters. While, China with total exports of USD 2209bn and 11.7 per cent is the leading merchandise exporter followed by US (8.4 per cent), Germany (7.7 per cent), Japan (3.8 per cent), and Netherlands (3.6 per cent).
To become internationally competitive, Jaipuria suggests commodity composition of the country to be focused for diversification with the inclusion of more and more commodities in export baskets. Contrary to increasing market diversification of India’s exports, product diversification of India’s exports has reported a fall from 57 per cent in FY2004 to around 64 per cent in FY2014.
For this, the country needs to provide facilitation to exporters to diversify the composition of export basket with enhanced knowledge of foreign markets regarding demand for goods across borders.
In addition, more and more information about the world demand dynamics would help exporters to enhance their export baskets and manufacturers to enhance their production possibility frontiers, he added.
Further, India needs to enhance its productivity in the manufacturing sector with a major focus on research and development and new product innovations.
He suggested that manufacturing processes in the country should be facilitated with the simplification of procedures and ease of doing business. Industrial infrastructure especially, the export infrastructure needs to be enhanced in terms of capacity expansion of ports, state of the art facilities in the railways and improved quality of roads.
The improvement in industrial infrastructure will not only improve the manufacturing competitiveness in India but also enhance its export competitiveness in the international markets, said Jaipuria. (KNN Bureau)
This was stated by President, PHD Chamber, Sharad Jaipuria, who added that India’s exports are no more majorly dependent on its traditional export destinations as volumes of exports towards African and Asian markets are increasing, according to an official release.
According to the PHD Research Bureau which has compiled data from the Ministry of Commerce and Industry, the region-wise percentage share in India’s exports is: EU countries (FY2004 – 22.7 and FY2014 – 16.4); Southern African Customs Union (FY2004 – 0.9 and FY2014 – 1.7); North America (FY2004 – 19.6 and FY2014 – 13.8); ASEAN (FY2004 – 9.1 and FY2014 – 10.5); West Asia-GCC (FY2004 – 11.1 and FY2014 – 15.3)
India’s export performance has exhibited remarkable performance during the last decade. At the time of commencement of reforms India’s exports were only of around USD 20 billion which increased to USD 45 billion in 2001-02 and to USD 312.6 billion in 2013-14. Thus, during the early phase of reforms it took as many as 10 years (FY1992- FY2002), to double the exports, however, within next 12 years (FY2003-FY2014) the exports increased nearly by six times, said Jaipuria.
Further, India‘s integration with the world economy, reflected by the trade openness indicator (merchandise trade to GDP) is also enhanced from 14.3 per cent of GDP in 1991-92, to 28.2 per cent in 2004-05 and further to 41.8 per cent of GDP in 2013-14. And, the share of India‘s merchandise exports in the world exports has been increased from 0.5 per cent in 1991 to 0.8 per cent in 2004 and to 1.7 per cent in 2013, he said.
However, despite exhibiting encouraging exports growth, India’s exports performance at the international stage is still not that much significant and suggests lot of scope to excel further with increased share in world exports, said Jaipuria.
This is apparent in the recent World Trade Report, 2014 of WTO wherein, India with total exports of around USD 313bn and 1.7 per cent share in world exports is ranked at the 19th position amongst the World’s top 20 leading exporters. While, China with total exports of USD 2209bn and 11.7 per cent is the leading merchandise exporter followed by US (8.4 per cent), Germany (7.7 per cent), Japan (3.8 per cent), and Netherlands (3.6 per cent).
To become internationally competitive, Jaipuria suggests commodity composition of the country to be focused for diversification with the inclusion of more and more commodities in export baskets. Contrary to increasing market diversification of India’s exports, product diversification of India’s exports has reported a fall from 57 per cent in FY2004 to around 64 per cent in FY2014.
For this, the country needs to provide facilitation to exporters to diversify the composition of export basket with enhanced knowledge of foreign markets regarding demand for goods across borders.
In addition, more and more information about the world demand dynamics would help exporters to enhance their export baskets and manufacturers to enhance their production possibility frontiers, he added.
Further, India needs to enhance its productivity in the manufacturing sector with a major focus on research and development and new product innovations.
He suggested that manufacturing processes in the country should be facilitated with the simplification of procedures and ease of doing business. Industrial infrastructure especially, the export infrastructure needs to be enhanced in terms of capacity expansion of ports, state of the art facilities in the railways and improved quality of roads.
The improvement in industrial infrastructure will not only improve the manufacturing competitiveness in India but also enhance its export competitiveness in the international markets, said Jaipuria. (KNN Bureau)
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