Indian exports have to be aligned with changing patterns of global economy, said the Federation of Indian Export Organization (FIEO).
FIEO President Sharad Kumar Saraf said that 50% of the global imports today is accounted by electrical & electronics products, automobiles, machinery, petroleum products and plastics products.
“Unfortunately, the share of such products in our exports is less than 33% despite having petroleum products accounting for roughly half of it. Our global share in such products is much less than 1%,” he added.
FIEO said that the global situation is becoming extremely challenging as rising protectionism is leading to uncertainty in global trade which will have adverse impact on it.
Despite having a moderate share in global trade, India’s exports have always followed the trend in global imports. Therefore, when global imports are declining, our exports are also likely to take a hit, it said.
Currently, India’s merchandise exports during April-Nov, 2019 are down by about 1.99%. Therefore, we feel our goods exports may touch USD 330-340 billion in the current fiscal added Saraf.
Fortunately, the order book position of Indian exporters are very encouraging. The less volatility in our currency has also been a positive factor, he said adding that the liquidity is also improving though we still have a lot of distance to cover.
FIEO President also added that the infrastructure improvement and initiatives on the logistics front will impart further competitiveness to our exports. If the global situation improves, which is likely in the first half of 2020, we may look for 15% growth in exports during the next Financial Year.
Saraf further added that India’s exports of high technology products are USD 20 billion, whereas Malaysia’s exports are USD 90 billion, Singapore USD 155 billion, South Korea USD 192 billion and China, a whopping, USD 652 billion.
While employment-intensive sectors should be pushed in exports, the new strategy should focus on technology-driven sectors as stated above. India having R&D advantage and professional manpower at its disposal should concentrate on such sectors where global trade is likely to rise further.
FDI in high technology could also help in expanding our high technology exports and cornering a greater share in global imports thereby increasing our share to about 2% in the next 3 years, said FIEO President.