The document discusses India's trade policy reforms from 2008-2019. It provides details on various trade agreements and reforms India has undertaken, including the establishment of free trade areas with ASEAN and other countries. It also analyzes the impact of reforms on India's economy, noting improvements in areas like the trade deficit but that challenges remain like infrastructure development. The document concludes by examining the US-China trade war and its effects on India's exports.

1. INTRODUCTION
Trade Policy Reforms
Presented By :
Siddhant Baliram Fulzele
(Fergusson College, Pune)

2. TRADE POLICY REFORMS
Trade Policy Reform is a collection of rules and regulations which pertain
to trade. Every nation has some form policy in place, which is most
appropriate for a country.
First Economic Policy Reform
was introduce in India in the
year 1991.
The Trade Policies in India are
formulated by Government
of India, Ministry Of
Commerce And Industries
and Department of
Commerce.

3. NEED FOR Trade policy reforms

4. DETAILED EXPLANATION OF REFORMS
1 (In June 2015, between India and Bangladesh)
- renewal of bilateral trade agreement
2 (In February 2016, between India and Argentina)
- MOU on cooperation and mutual assistance
3 (In June 2017, between EXIM Bank and KEXIM bank)
- to support priority sectors by utilizing export credit
4 (In June 2018, between India and China)
- export of non-basmati rice to China
5 (In august 2019, between India and Russia)
- to strengthen cooperation in trade
6 (In August 2019, between India and France)
- focusing on skill development etc

5. ASEAN–India Free Trade Area (AIFTA) (1st January,2010) free trade area among
members of the Association of Southeast Asian Nations (ASEAN) and India.
India - Malaysia Comprehensive Economic Cooperation
Agreement
(1st September, 2011) Malaysia offered market access to India, items of
considerable export interest.
(November 2012) The Regional Comprehensive Economic
Partnership (RCEP) is proposed
free trade agreement (FTA) between the Association of Southeast Asian
Nations (ASEAN) and
its six FTA partners
Five-Year Development Program for Economic and Trade
Cooperation between the People's Republic of China and the
Republic of India (September 18, 2014)
to lay down roadmap for promoting balanced and sustainable
development of economic and
trade relations
(November 2018) India and Iran signed a bilateral agreement to settle oil trades in Indian currency.

6. New Foreign Trade Policy(2009-2014)
The policy aims at developing export
potential, improving export performance,
boosting foreign
trade and earning valuable foreign
exchange.
Target
• Export Target : $ 200
Billion for 2010-11
• Export Growth Target :
15 % for the next two
year and 25 % there
after.
Schemes
• EPCG-Export
Promotion Capital
Goods
• Obligation under
EPCG scheme
relaxed
Impact
• 26 new markets added under Focus
Market Scheme (FMS).
• An updated compilation of
Standard Input Output Norms
(SION) and ITC (HS)
Classification of Export and Import
Items published.

7. New Foreign Trade Policy(2015-2020)
Aims at boosting india’s exports and Central Government’s
projects “ Make In India ” and “ Digital India ”.
Schemes
• MEIS- Merchandise
Exports from India.
• SEIS- Service
Exports from India.
Impacts
• Increased digitalization of exports and imports with the
aim to move towards paperless working in 24×7
environment.
• Create employment Avenues in manufacturing and
services.
• Boost to exports of defense and hi-tech items.
Target
This policy mainly focuses on an ambitious export target of
900 billion dollars by the year 2020.New Foreign Trade Policy
(2015-2020)

8. Establishing Trade Promotion Bodies And New Initiatives
1st April 2016 Single Window Interface for Facilitating Trade (SWIFT) provides a single-point
interface for clearance, reduces documentation and costs.
Make in India ,2014 major national programmed designed to boost investment, skill
development, innovation and infrastructure.
Advance authorization scheme :
Allows businesses to import inputs within the country without paying any duty
Market Development Assistance Scheme
Description : Entrepreneurs get funding for participating in trade
fairs.assists exporters for export promotion activities.
Market Access Initiative (MAI)
an Export Promotion Scheme,a catalyst to promote India’s
exports on a sustained basis.
Trade Infrastructure for Export Scheme (TIES) from FY 2017-18 for creation of infrastructure
for growth of exports from the States.

9. National Trade Facilitation Action Plan (2017-2020)
To transform cross border clearance ecosystem through efficient, transparent, risk
based, coordinated, digital, seamless and technology driven procedures which are
supported by state-of-the-art sea ports, airports, land border crossings, rail, road and other
logistics infrastructure.
Objectives
1. Improvement in Ease of Doing Business Rankings.
2. Reduction in cargo release time.
3. Paperless Regulatory Environment.
4. Transparent and predictable legal regime.
5. Improved investment climate through better infrastructure.
NTFAP Released on 20th July, 2017 by Arun Jaitley in New Delhi.

10. Critical Appraisal
• India has made important strides since
the initiation of reforms in 1991.An
assessment of what has been achieved so
far and what remains on the reform
agenda is a topic of discussion.
• Reforms in the industrial, trade, and
financial sectors, among others, have
been wide and deep. As a consequence,
they have contributed more
meaningfully in attaining higher rates of
growth.
• The economy has produced new dynamism.
• Although at present times India faces significant challenges in the area of trade policy— the
global economic slowdown, increasing protectionism, the stalled mega-trade deals that could
in time be revived, and perhaps more important, its own domestic preoccupations.

11. • We in India are in the cusp of a great opportunity and we are targeting at reaching USD 5
trillion economy by 2024 and reach USD 10 trillion economy by 2030," DPIIT Secretary
Guruprasad Mohapatra.
• To be able to achieve this target, the government and the institutions need to work on the
potholes in the economy like
Critical Appraisal
1. Current account deficit is a major problem
2. Bop crisis
3. Foreign exchange crisis
4. High Tariffs and Protectionist Policies that
carefully needs to be framed out
5. Lags in infrastructure
6. Trade deficit
7. Share in the international market is not upto the
mark.
8. Depreciating value of rupee.

12. Most common ofTariff measures are the
trade control. It is the tax levied or imposed by
government
boundaries.
on good when it crosses national
Tariff measures are imposed for the purpose of :-
To increase inflationary pressures.
To increase special interests privileges.
For government control and political
considerations
in economic matters.
To
To
To
maintain balance of payments position.
weaken supply and demand patterns.
maintain international relations.
TARIFF MEASURES

13. these are:-
procedures
MEASURES
Non –tariff measures are the trade measures that restricts imports and export
of goods other than the simple imposition of tariff.
These are the restrictions that arise from different measures taken by the
government and authorities in the form of government laws, regulations,
policies ,conditions and specified
and export difficult and costly.
market requirements in order to make import
Non-tariff is divided into six types and
1.
2.
3.
4.
5.
6.
Specific limitation on trade
Customs and administrative
Standards
Government participation in
Charges on imports
Other non tariff measures
entry
trade
NON-TARIFF

14. NON TARIFF MEASURESTARIFF MEASURES V/S
Revenue is received by
government.
Customs authorities do valuation
procedures and classification.
Levied of import duty restricts
the monopolistic actions by
monopolistic organisations.
Subject to legislative enactment
under terms of general Agreement
on Tariff and Trade (GATT) and
inflexible.
Importers exploitation of more
profits supressed and retrained.
Simple to operate administratively.
Favours efficiency of firms.
There is no revenue receipts but
only protection of domestic
industry.
There is no valuation procedure
and classification .
Monopolistic organisations
command high prices through
low output.
Flexible and discussed at officials
levels only.
Importers make more profits and
exploit the market.
More official involved and less
simple.
Discriminates against new
organisations.

15. Case study on .
US-China Trade War

16. What is trade war?
A trade war is an economic conflict resulting from protectionism in which two
or more countries raise or create tariffs or other trade barriers against each
other in response to trade barriers created by counterparty.

19. IMPACT ON INDIAN EXPORTS
India’s exports to China have grown much faster than to US post the Trade war
between the 2 large economies. While overall exports to US grew by 9.46% to $52.4
billion in FY19, for China the growth was 25.6% to $16.7 billion. The products on
which USA and China have imposed tariffs on each other, India has made modest
gains in capturing such market.
As the ongoing trade dispute continues to escalate, tariffs are making exports from
China more and more expensive for US importers. Many firms have been doing their
sums and looking for new locations to re-site their manufacturing operations. But it
is surprising to note that out of 56 companies that relocated their production out of
China between April 2018 and August 2019 only 3 went to India. Despite India
having the ideal demographics to be global manufacturing powerhouses to rival
China which at the moment makes one-fifth of the world's goods. Although there is
a progress, more has to be done if India aims to achieve PM Modi's aim, first
declared in 2014, to increase manufacturing share of GDP to 25% by 2025.
As per the reports published in August 2019, the rupee is falling following the
Chinese Yuan's steep decline ushering in immense turbulence in financial markets.

21. IMPACTS OF REFROMS ON INDIAN ECONOMY
TRADE DEFICIT
India’s trade deficit increased almost steadily from US$28.0 billion in 2004-05 to US$118.6 billion in 2010-
11
It grew exponentially to reach unsustainable levels of US$183.4 billion and US$190.3 billion respectively in
the next two years
However, it moderated to US$135.8 billion in 2013-14 as a result of measures taken by the government to
contain trade and current account deficits
the major component of trade
deficit, which was hovering at
around US$100 billion from
2011-12 to 2013-14, declined to
US$81.5 billion in 2014-15 and
to US$44.2 billion in 2015-16
(April-December)
Trade policy has focused on
promoting exports and thereby
moderate the levels of trade
deficit.

22. Current Account Deficit
The external sector outcome in 2014-15 and the first half (H1) of 2015-16 indicates
continued moderation in levels of trade and current account deficits with broadly
adequate financing
Under the capital/finance account of balance of payments (BoP), foreign investment
reached a peak level of US$73.5 billion in 2014-15
Capital/finance flows (net) were US$88.2 billion in 2014-15, driven largely by
investment flows. Higher capital/ financial flows with low CAD resulted in large accretion
to reserves (US$61.4 billion) in 2014-15
During H1 of 2015-16, despite a decline in merchandise exports
the India’s external sector situation remained comfortable
Some of the salient external sector developments were as
follows:-
(i) lower trade deficit and modest growth in invisibles resulted in
lower CAD
(ii) the increase in FDI inflows and NRI deposits continued; and
(iii) there was net outflow of portfolio investment.

23. Foreign Exchange Reserves
The level of foreign exchange reserves can change due to change in reserves on BoP basis as well as valuation changes in the
assets held by the RBI.
With the exception of the crisis-hit years of 2008-09 and 2011-12, forex reserves have been in accumulation mode, reflecting
excess of financial flows over the requirements of current account.
In H1 of 2015-16, India’s foreign exchange reserves increased by US$10.6 billion on BoP basis while in nominal terms the
increase was only to the tune of US$8.7 billion.
Among the major economies with CAD, India is the
second largest foreign exchange reserve holder after
Brazil. India’s foreign exchange reserves at US$351.5
billion as on 5 February 2016 mainly comprised foreign
currency assets amounting to US$328.4 billion, which
accounted for about 93.4 per cent of the total.
Gold at US$17.7 billion was the second largest
component of foreign exchange reserv
With increase in reserves in 2015-16 (H1), all
traditional reserve-based external sector vulnerability
indicators have improved.

24. Exchange Rate(Value of Rupee)
The average annual exchange rate of the rupee depreciated sharply from Rs54.4 per US dollar in 2012-13 to Rs60.5 in 201314 and was broadly
stable at R61.1 per US dollar in 2014-15
In 2014-15, although the rupee declined in value against the dollar by 1.0 per cent, it became stronger against other currencies.
It appreciated, for example, against the Japanese yen and the euro by 8.2 per cent and 4.7 per cent respectively
The Indian rupee depreciated against the dollar as the dollar strengthened against all the major currencies owing to stronger growth in the USA
and also because China’s growth and currency developments this year deteriorated.
The rupee witnessed bouts of volatility, taking cues from a combination of domestic and global developments which included contraction in
exports
The rupee stabilized in September 2015 and traded in a narrow range but again depreciated in October to December 2015
Thus, during 201516, the general tendency of appreciation of the US dollar against major currencies and uncertainty and volatility in the
international financial market resulted in depreciation of the rupee-dollar exchange rate
However, the rupee appreciated against the euro and the pound sterling from September 2015 onwards as shown in the figure.

25. Key Development Indicators of India in 2010 are below
India GDP in current US dollar was 1,656,617 million.
GNI per capita, Atlas method (current US$) was 1,220.00 .
India Trade balance: as % of GDP was -4.51.
Trade balance in current US$ was -74,680.00 million.
Trade as percentage of GDP was 49.69 .
Trade in services as percentage of GDP was 11.83 .
Development Indicators 2010
Trade Indicators 2010
Trade Indicators for India in 2010 are below
• Hirschman Herfindahl market concentration index was 0.04.
• Index of export market penetration was 27.14.
• World Growth in percentage was 10.65 and India Country Growth was 17.34 .

26. Key Development Indicators of India in 2014 are below
India GDP in current US dollar was 2,039,127 million.
GNI per capita, Atlas method (current US$) was 1,560.00 .
India Trade balance: as % of GDP was -2.99.
Trade balance in current US$ was -60,894.00 million.
Trade as percentage of GDP was 48.92 .
Trade in services as percentage of GDP was 11.69 .
Development Indicators 2014
Trade Indicators 2014
Trade Indicators for India in 2014 are below
• Hirschman Herfindahl market concentration index was 0.05.
• Index of export market penetration was 27.93.
• World Growth in percentage was 0.10 and India Country Growth was -0.28 .

27. Key Development Indicators of India in 2017 are below
India GDP in current US dollar was 2,600,818 million.
GNI per capita, Atlas method (current US$) was 1,800.00 .
India Trade balance: as % of GDP was -2.98.
Trade balance in current US$ was -77,495.00 million.
Trade as percentage of GDP was 41.07 .
Trade in services as percentage of GDP was 11.33 .
Development Indicators 2017
Trade Indicators 2017
Trade Indicators for India in 2017 are below
• Hirschman Herfindahl market concentration index was 0.06.
• Index of export market penetration was 24.43.
• World Growth in percentage was 1.50 and India Country Growth was -1.10 .

28. FOREIGN EXCHANGE RESERVESIMPORTS/EXPORTS

29. Trade Balance

30. Conclusion
In this presentation,we tried to compile the trade policy reforms of India from the
period
2008-2019.We looked at the meaning of trade policies,to its need,impact and how does
a
country formulates these policies.We also looked at the ways it influences the overall
economy
of a country.In case of India we find that in spite of having trade policies being launched
amended the economy is still facing major setbacks.The macroeconomic parameters are
showing signs of an alert.How can India reach the goal we are aiming depends on these
policies and many more.At last we looked at the ongoing trade war between the US and
China
and its impact on the economy of India.

31. References
• https://wits.worldbank.org/
• https://www.ibef.org/economy/trade-and-external-sector
• http://dgft.gov.in/
• https://www.indiabudget.gov.in/
• https://www.slideshare.net/
• https://economictimes.indiatimes.com/topic/US-China-
trade-war