India’s foreign trade policy 1

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India’s foreign trade policy 1

  1. 1. INDIA’S FOREIGN TRADE POLICY HISTORY AND EVOLUTION www.StudsPlanet.com
  2. 2. INDIA- HISTORY • Glorious Tradition • Indian Spice and Cloth exported to East and West- during 1920’s • Colonial: Raw material exports and manufacturers importing • India’s Exports 300 Crores in 1920 • 5th Largest Exporting Nation- 1920’s • 1947-48--- 400 Crores of Exports www.StudsPlanet.com
  3. 3. POST INDEPENDENCE • Liberal Import Policy- Wartime shortages and to help nascent industrial development • Accumulated Sterling balances of Large external aid • Tighter Control on Sterling • Forced exports as a priority in 1960’s • Exports in 1st Five year Rs 962 crores www.StudsPlanet.com
  4. 4. POST INDEPENDENCE • 977 Crores in 2nd Five year plan 1956-61 • Rising domestic demand and international recession • Change in Intl. trade pattern • 1957 Imports was contained – only essentials • World exports 1950’s Doubled • India’s share in world exports 2.5%-in 948 to 1. 27% in 1958 www.StudsPlanet.com
  5. 5. INDIA AND GLOBAL TRADE India had a significant share in the world trade at the time of independence. However, since then there was a regular decline in India’s share in the world exports till 1980. From 1950 to 1980 the percentage declined from 2 to 0.4. It, how ever improved to about 0.8 by 1997. It reached 0.83% in 2003 and rose to 1.45% in 2008. www.StudsPlanet.com
  6. 6. THE BREAK-UP OF FOREIGN TRADE IN TERMS OF EXPORTS & IMPORTS (RS.CRORES) Year Export Import BOT 1995-96 106353 122678 -16325 1996-97 85623 97111 -1488 1997-98 126286 151553 -25267 1998-99 101850 132447 -25267 2002-03 255137 297206 -42067 2003-04 291582 353976 -62394 2004-05 356625 481950 -125190 2005-06 456418 660408 -203990 www.StudsPlanet.com
  7. 7. EXPORTS AS A % 0F NATIONAL INCOME YEAR IN % 1960-61 6.8 1970-71 3.8 1980-81 5.4 1990-91 7.2 1996-97 9.6 1997-98 8.4 1998-99 8.0 1999-00 8.5 2000-01 8.8 2001-02 8.7 2002-03 9.0 2007-08 17 www.StudsPlanet.com
  8. 8. EXPORT STRATEGY • Imports will increase and to finance them , we need higher exports earning. • It is not advisable to depend on external assistance to finance imports. • Debt-servicing burden is ever mounting, necessitating increased export earning. www.StudsPlanet.com
  9. 9. INDIA’S INTERNATIONAL TRADE  India accounts for 1.3 percent of world merchandise trade (2009)  India ranks 21 among leading exporting countries in the world (2009)  Among leading importers, India is ranked 14 and accounts for 2 per cent of total global imports  In respect of trade in commercial services India is placed in the 12th position among global exporters of commercial services  India exported 87 billion dollars worth of commercial services in 2009 www.StudsPlanet.com
  10. 10. INDIA – SURGING EXPORTS  Total Exports during April- September (2011-12) topped $ 160 billion  52 per cent growth registered  Exports crossed target of $ 200 billion for 2010-11 to reach $ 252 Billion ( $41 per cent growth)  IT software and IT enabled services exports touched $49 billion in 2010 rising from $2 billion in 1998 www.StudsPlanet.com
  11. 11. SLIDE 11  Mauritius has been the largest contributor towards FDI (42%)  Singapore (9%), USA (7%), UK (5%), Netherlands (4%), Cyprus (4%), Japan (4%), Germany, France and UAE are among the top ten investors  Sectors attracting Highest FDI equity inflows are –  Financial and non financial services (21%)  Computer Software and Hardware (9%)  Telecommunications (8%)  Housing and Real Estate (7%)  Construction activities (including roads & highways)(7%)  Power (5%)  Automobile Industry (4%)  Metallurgical Industries (3%)  Petroleum and natural gas (3%)  Chemicals (2%) www.StudsPlanet.com
  12. 12. SLIDE 12 India-Regional Cooperation  Regional Trading Agreements have been a very prominent feature of the Multilateral Trading system  India has signed free trade agreements with SAARC, ASEAN , Singapore, South Korea, Sri Lanka and Bhutan,  Negotiating FTAs with EU, EFTA, Japan, Thailand and Bangladesh  India is a member of the SAARC Regional Trading Bloc www.StudsPlanet.com
  13. 13. INDIA-REGIONAL COOPERATION Regional Trading Agreements have been a very prominent feature of the Multilateral Trading system India has signed free trade agreements with SAARC, ASEAN , Singapore, South Korea, Sri Lanka and Bhutan, Negotiating FTAs with EU, EFTA, Japan, Thailand and Bangladeshwww.StudsPlanet.com
  14. 14. FOREIGN TRADE POLICY (2004-09) OBJECTIVES (i) to double our percentage share of global merchandize trade within 5 years (ii) to use trade expansion as an effective instrument of economic growth and employment generation. www.StudsPlanet.com
  15. 15. ACHIEVEMENTS OF FOREIGN TRADE POLICY (2004-09) Looking back, we can say with satisfaction that the UPA Government has delivered on its promise. In the last five years ; • our exports witnessed robust growth to reach a level of US$ 168 billion in 2008-09 from US$ 63 billion in 2003-04. • Our share of global merchandise trade was 0.83% in 2003; it rose to 1.45% in 2008 as per WTO estimates. • On the employment front, studies have suggested that nearly 14 million jobs as a result of augmented exports in the last five years. www.StudsPlanet.com

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