India’s merchandise trade is unbalanced and concentrated in few products and that too of the wrong products, NITI Aayog CEO BVR Subrahmanyam said, suggesting policy interventions to ramp up India’s presence in intermediates, need to open up markets, diversification of manufacturing, removing non-trade barriers and focussing on trade within Asia.
“India’s share is less than 2% of over 90% of world imports in 2024 which shows our trade is tilted in the wrong direction,” he said after the release of the NITI Aayog’s Trade Watch quarterly report for January-March quarter of 2024-25 on Monday.
According to Subrahmanyam, the world trade has moved on with more than half of it being intermediates but India lacks on that. “Policy interventions are needed to boost India’s trade in intermediates,” he said.
Elaborating on India’s trading partners, Subrahmanyam said , “Asia is missing from our export destination and the Look East policy is not happening in trade.”
“We need to put in place a strong neighborhood trading arrangement to expand markets,” he said, citing the example of the US where the majority of trade happens with Canada and Mexico.
Subhramanyam said that improving competitiveness in manufacturing is essential while also focussing on improving factors of production including land and labour.
“Hopefully, the upcoming National Manufacturing Policy will address a lot of these challenges and it focuses on clusters and gives the best world-class ecosystem for trade,” he said.
India-US trade deal
Speaking on the impact of high US tariffs on India’s trade, Subrahmanyam said there has not been any impact till now and exports are expected to be on track for Christmas and until Spring.
“US tariffs have yet not impacted our trade as unwinding trade channels is difficult and these disruptions do not happen overnight,” he said.
“We foresee normal exports for Christmas and Spring but Summers could be difficult if the trade deal between the two countries does not conclude by November,” he said, exuding confidence that talks are on between India and the US and a deal could be in place soon with both sides holding fresh rounds of discussions last month.
Reforms
Subrahmanyam said another round of major reforms, after GST 2.0, expected before Diwali with the Rajiv Gauba-led committee already submitted their first set of reports on proposed reform measures. He, however, did not divulge details on the upcoming reform measures.
“India’s share is less than 2% of over 90% of world imports in 2024 which shows our trade is tilted in the wrong direction,” he said after the release of the NITI Aayog’s Trade Watch quarterly report for January-March quarter of 2024-25 on Monday.
According to Subrahmanyam, the world trade has moved on with more than half of it being intermediates but India lacks on that. “Policy interventions are needed to boost India’s trade in intermediates,” he said.
Elaborating on India’s trading partners, Subrahmanyam said , “Asia is missing from our export destination and the Look East policy is not happening in trade.”
“We need to put in place a strong neighborhood trading arrangement to expand markets,” he said, citing the example of the US where the majority of trade happens with Canada and Mexico.
Subhramanyam said that improving competitiveness in manufacturing is essential while also focussing on improving factors of production including land and labour.
“Hopefully, the upcoming National Manufacturing Policy will address a lot of these challenges and it focuses on clusters and gives the best world-class ecosystem for trade,” he said.
India-US trade deal
Speaking on the impact of high US tariffs on India’s trade, Subrahmanyam said there has not been any impact till now and exports are expected to be on track for Christmas and until Spring.
“US tariffs have yet not impacted our trade as unwinding trade channels is difficult and these disruptions do not happen overnight,” he said.
“We foresee normal exports for Christmas and Spring but Summers could be difficult if the trade deal between the two countries does not conclude by November,” he said, exuding confidence that talks are on between India and the US and a deal could be in place soon with both sides holding fresh rounds of discussions last month.
Reforms
Subrahmanyam said another round of major reforms, after GST 2.0, expected before Diwali with the Rajiv Gauba-led committee already submitted their first set of reports on proposed reform measures. He, however, did not divulge details on the upcoming reform measures.
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