Assignment 1
Q 43. Why Exports are crucial for India’s Economic future?
Export means the transferring of any good from one country to another country in a legal way for the purpose of trade. Export goods are provided to the foreign consumers by the domestic producers.
Markets
Though India has seen some product diversification in its export basket, it has not expanded significantly in the two big markets-Africa and Latin America.
India’s business with South Asian countries is also negligible. This region has not been integrated with the global economy, though political and economic initiatives have been taken in the recent past in this direction.
Leading Export Items of India
In the past ten years, Indian exports have grown at a rate of nearly 22%. Some commodities have enjoyed faster export growth than others. Some of India's main export items are cotton, textiles, jute goods, tea, coffee, cocoa products, rice, wheat, pickles, mango pulp, juices, jams, preserved vegetables etc. India exports its goods to some of the leading countries of the world such as UK, Belgium, USA, China, Russia etc.
Export Trends
If the Indian economy grows at the same pace, India would most definitely export goods worth US $500 billion by 2013 and may supersede the exports of other large developing countries like Brazil.
The Way Ahead
India needs the right mix of policy formulation sector focus and industry led initiatives to move up the value chain in the global export basket
The Opportunity
Q 43. Why Exports are crucial for India’s Economic future?
Export means the transferring of any good from one country to another country in a legal way for the purpose of trade. Export goods are provided to the foreign consumers by the domestic producers.
Markets
Though India has seen some product diversification in its export basket, it has not expanded significantly in the two big markets-Africa and Latin America.
India’s business with South Asian countries is also negligible. This region has not been integrated with the global economy, though political and economic initiatives have been taken in the recent past in this direction.
Leading Export Items of India
In the past ten years, Indian exports have grown at a rate of nearly 22%. Some commodities have enjoyed faster export growth than others. Some of India's main export items are cotton, textiles, jute goods, tea, coffee, cocoa products, rice, wheat, pickles, mango pulp, juices, jams, preserved vegetables etc. India exports its goods to some of the leading countries of the world such as UK, Belgium, USA, China, Russia etc.
Export Trends
If the Indian economy grows at the same pace, India would most definitely export goods worth US $500 billion by 2013 and may supersede the exports of other large developing countries like Brazil.
The Way Ahead
India needs the right mix of policy formulation sector focus and industry led initiatives to move up the value chain in the global export basket
The Opportunity
It is very clear that Indian exports have still not achieved their true potential and there exists immense opportunities for expanding the basket of India’s exports. With a strategic attention on the new markets that are evolving due to free trade, India is witnessing a boom in both manufacturing and services.
Problems of the Indian Export Sector
There are few problems which need to be solved before India makes a mark for itself in the export sector. The Indian goods have to be of superior quality. The packaging and branding should be such that countries are interested to export from India. At the same time India must look for potential market to sell their goods. The government should frame policies which gives boost to the exports.
Problems of the Indian Export Sector
There are few problems which need to be solved before India makes a mark for itself in the export sector. The Indian goods have to be of superior quality. The packaging and branding should be such that countries are interested to export from India. At the same time India must look for potential market to sell their goods. The government should frame policies which gives boost to the exports.
Export Promotion Schemes
• Software Technology Parks (STPs)
• Special Economic Zones (SEZ) Scheme
Software Technology Parks (STPs)
The STP Scheme has been extremely successful in fostering the growth of the software industry. The exports made by STP Units have grown many folds over the years. Today the exports made by STPI registered unit during 2008-09 are INR 215571 Crores about 90% of total software exports from the Country.
Special Economic Zones (SEZ) Scheme
In 2005, the Ministry of Commerce, Government of India has enacted the Special Economic Zone (SEZ) Act, with an objective of providing an internationally competitive and hassle free environment for exports. A SEZ is defined as a "specifically demarked duty-free enclave and shall deemed to be foreign territory (out of Customs jurisdiction) for the purpose of trade operations and duties and tariffs".
ECONOMIC SUCCESS:
The economy of India is the 12th largest in the world in terms of the rates of market exchange while in terms of the purchasing power parity (PPP), it is the 4th largest in the world. Since its independence in the year 1947, the economy of India has gradually grown and today it is one of the most developing economies in the global scenario.
The early years of Indian economy
After independence, for a period of around one and a half decades, India followed the social democratic economic policies. From the year 1991, to keep pace with the changing trends in the market, a new liberalization policy was formulated. The chief architect of this policy was Dr Manmohan Singh, the then Finance Minister of India. Due to the economic liberalization policies in the 1990s and the 2000s, the country steadily climbed up the economic ladder and by the year 2008, it became the second fastest growing economy in the globe.
The growth of various sectors
The share of the service industry accounts to around 54% of the annual Gross Domestic Product (GDP) of the country. Next are the industrial and agricultural sectors which contribute around 29% and 17% respectively. Some of the major agricultural export items consist of wheat, rice, tea, cotton, jute, sugarcane and so on. Some of the other allied exports consist of steel, chemical, textiles, cement, machinery, IT services and so on.
GLOBAL FINANCIAL CRISIS AND ITS IMPACT ON INDIA
The global financial crisis has started in August 2007 when the ‘sub-prime mortgage’ crisis first surfaced in the US. India economy was almost immediate. Credit flows suddenly dried-up and, overnight, money market interest rate spiked to above 20 percent and remained high for the next month. It is, perhaps judicious to assume that the impacts of the global economic downturn, the first in the center of global capitalism since the Great Depression, on the Indian economy are still unfolding. The crisis confronted India with discouraging macroeconomic challenges like a contraction in trade, a net outflow of foreign capital, fall in stock market, a large reduction in foreign reserves, slowdown in domestic demand, slowdown in exports, sudden fall in growth rate etc.
Back to the exporters at home, the good news is that Commerce and Industry Minister, Anand Sharma has recently announced that more sops, just like the last year, will be rolled out in mid-January for some select export sectors that continue to languish in the global market. However, exporters' wish list for this New Year certainly includes many more, such as reduction in export credit rate, less red tape to bring down transaction costs, efficient return of service tax, and measures to bring down labour and raw material costs.
In the light of the government's newly set export target of US$ 400 billion by 2014, it could be expected that at least some of the challenges faced by the Indian exporters would be addressed this year. Also, experts believe that the recently signed FTAs with nations including New Zealand, Canada, Israel and ASEAN and some other trade pacts in the pipeline including those with the European Union, Japan, Russia, Malaysia, South Africa, Egypt and Turkey will allow more access to the Indian exporters in overseas market.
CONCLUSION
Indian Economy is growing at Faster Pace and it is vision to make it morePowerful More and more Export promotion measures should be implemented which will lead to increase in employment, innovation, Better relations with other countries thereby accelerating economic growth.
SUBMITTED TO: SUBMITTED BY:
MR.GURDEEPAK SINGH MAYANK ARORA
MBA-I SEC:A
The economy of India is the 12th largest in the world in terms of the rates of market exchange while in terms of the purchasing power parity (PPP), it is the 4th largest in the world. Since its independence in the year 1947, the economy of India has gradually grown and today it is one of the most developing economies in the global scenario.
The early years of Indian economy
After independence, for a period of around one and a half decades, India followed the social democratic economic policies. From the year 1991, to keep pace with the changing trends in the market, a new liberalization policy was formulated. The chief architect of this policy was Dr Manmohan Singh, the then Finance Minister of India. Due to the economic liberalization policies in the 1990s and the 2000s, the country steadily climbed up the economic ladder and by the year 2008, it became the second fastest growing economy in the globe.
The growth of various sectors
The share of the service industry accounts to around 54% of the annual Gross Domestic Product (GDP) of the country. Next are the industrial and agricultural sectors which contribute around 29% and 17% respectively. Some of the major agricultural export items consist of wheat, rice, tea, cotton, jute, sugarcane and so on. Some of the other allied exports consist of steel, chemical, textiles, cement, machinery, IT services and so on.
GLOBAL FINANCIAL CRISIS AND ITS IMPACT ON INDIA
The global financial crisis has started in August 2007 when the ‘sub-prime mortgage’ crisis first surfaced in the US. India economy was almost immediate. Credit flows suddenly dried-up and, overnight, money market interest rate spiked to above 20 percent and remained high for the next month. It is, perhaps judicious to assume that the impacts of the global economic downturn, the first in the center of global capitalism since the Great Depression, on the Indian economy are still unfolding. The crisis confronted India with discouraging macroeconomic challenges like a contraction in trade, a net outflow of foreign capital, fall in stock market, a large reduction in foreign reserves, slowdown in domestic demand, slowdown in exports, sudden fall in growth rate etc.
Back to the exporters at home, the good news is that Commerce and Industry Minister, Anand Sharma has recently announced that more sops, just like the last year, will be rolled out in mid-January for some select export sectors that continue to languish in the global market. However, exporters' wish list for this New Year certainly includes many more, such as reduction in export credit rate, less red tape to bring down transaction costs, efficient return of service tax, and measures to bring down labour and raw material costs.
In the light of the government's newly set export target of US$ 400 billion by 2014, it could be expected that at least some of the challenges faced by the Indian exporters would be addressed this year. Also, experts believe that the recently signed FTAs with nations including New Zealand, Canada, Israel and ASEAN and some other trade pacts in the pipeline including those with the European Union, Japan, Russia, Malaysia, South Africa, Egypt and Turkey will allow more access to the Indian exporters in overseas market.
CONCLUSION
Indian Economy is growing at Faster Pace and it is vision to make it morePowerful More and more Export promotion measures should be implemented which will lead to increase in employment, innovation, Better relations with other countries thereby accelerating economic growth.
SUBMITTED TO: SUBMITTED BY:
MR.GURDEEPAK SINGH MAYANK ARORA
MBA-I SEC:A
Mayank a good try but no referencing and title not as per guidelines????? Somewhat deviated from the topic????
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