By, Pinak Sarkar and Dr. (Prof.) Martin Patrick
India is the seventh largest economy in the world. However, it is only the sixteenth largest exporter, in terms of value with its exports accounting for around USD 336.6 billion. In contrast, India is the 12th largest importer demanding USD 477.3 billion as of 2013. Although it is claimed that the liberalisation of the Indian economy in the 1991 has greatly transformed the economy by removing many trade barriers and de-licensing of the industrial sector, its value or trade flow has remained very ordinary for a country with a population of 1.26 billion (Census, 2011).
India witnesses much lesser trade flow by value not only when compared with the bigger economies such as the United States of America and China, but also far lesser than smaller economies such as a Singapore and the Netherlands (Table-1).
In order to understand India’s current limitations and identify untapped opportunities this article tries to answer questions such as:
- What are India’s main trade partners and current trade balance?
- How is India in terms of current trade patterns compared with the rest of the world?
- How are trade policies formulated in India? How consistent are these policies with international trading requirements and practices?
- What are the import procedures? What are the different costs borne by importers due to these policies and procedures? Are there specific imports for which these costs are unreasonable high? What are these costs in quantitative terms? How trade distortive are these costs?
This study attempts to suggest that import tariffs have to be lessened on the one hand and more importantly import procedures have to be reduced on the other so as to create an atmosphere of competition in policy action.
Read the full report here: Trade Report