SME Times News Bureau | 27 Jul, 2019
Industry body Confederation of Indian Industry
(CII) has identified 31 items with high potential for exports in a new study on
boosting merchandise exports.
The identification of the products comes in the
light of moderating export growth in the first quarter of 2019-20 as a result
of global trade developments. Items in the list include women’s apparel, drugs,
cyclic hydrocarbons, and furniture, among others.
“A targeted export strategy that identifies and
boosts the right products is imperative for achieving double digit export
growth. An export strategy assumes greater significance given a rapidly
changing global trade landscape, shifting of global value chains and new free
trade agreements, including mega trade agreements. CII has analyzed and
identified select export items where India can become a leading exporter and
offers recommendations for boosting such products,” said Chandrajit Banerjee,
Director General, CII.
In a research paper, “Indian Exports: The Next
Trajectory -- Mapping Products and Destinations”, CII has suggested a
double-pronged approach of expanding domestic production and undertaking
targeted promotion in top importing nations to build exports in these items.
To encourage domestic manufacturing, CII calls for
strengthening industrial clusters with related infrastructure and port
connectivity.
Adopting an integrated value-chain approach for
establishing global linkages is another important recommendation which would
require interventions such as logistics and infrastructure support, skill
development initiatives, and creating awareness for better understanding of
GVCs, among others.
Trade and investment agreements and an
infrastructure for promoting standards and certifications are needed, said CII.
Incentives to encourage greater adoption of technology and innovation and
boosting high-tech exports are also suggested.
A key recommendation is the need for developing an
export strategy at the state level, based on states’ comparative advantages.
The paper employs a dual identification strategy of
shortlisting top imports of the top importing nations.
These products at the HS 4-digit level are mapped
with India’s current export profile for determining its export competitiveness
to these top importing nations. Four criteria are considered - the total
exported value of products, world export shares, India’s rank as a top exporter
in the top import items and India’s frequency as a top exporter among those top
imports.
After applying these filters, 31 products are
identified. In ‘Achievers’ where India has a strong footprint, the categories
of women’s apparel and medicaments are top products. The ‘Aspirers’ category
includes cyclic hydrocarbons and furniture, among others which have significant
potential. ‘Products where capacities need to be enhanced’ include telephone
sets, electrical apparatus, motor cars and motor vehicles, etc.
For enhancing the market promotion of the select
products, CII recommends that non-tariff barriers must be taken up with the
respective Governments of destination countries.
Other suggestions include facilitating effective
marketing strategies by setting up centres in top international markets,
product promotion and integration of brand building initiatives with India’s
commercial missions.
Given the uncertain global trade climate, India’s
merchandise exports fell by 1.7% in the first quarter of 2019-20 to $81
billion.
In 2018-19, exports expanded by 8.8% to cross $330
billion. India is facing headwinds from ongoing global trade conflicts at a
time when some other countries are capitalizing on changing supply chains and
the country must step up its export strategy to compete.