India’s export performance has seen a significant surge in the fiscal year 2023-24, even amid global economic uncertainties. Recent data highlights robust growth in both merchandise and services exports, positioning India as a major player in the global trade landscape. This growth, driven by strategic initiatives and sectoral strength, reflects India’s resilience despite geopolitical challenges. India’s merchandise exports reached around $447 billion in FY24, driven by the strong performance of sectors like electronics, pharmaceuticals, and engineering products. Notably, electronic goods exports surged by 37% in July 2024 alone, reflecting increased global demand for Indian technological products. Other notable gains were seen in meat, dairy, and poultry exports, which grew by over 50%, and ready-made garments, which also saw significant increases. The services sector continues to be a powerhouse for India, with exports reaching approximately $329.4 billion. The country has established itself as the 2nd largest global exporter of telecommunications and information services, showcasing its technological prowess. India’s robust IT, telecommunications, and professional services sectors have played a crucial role in driving services exports, solidifying its rank as the 7th largest services exporter worldwide. Recent Free Trade Agreements (FTAs) with key markets like the UAE and Australia have been instrumental in boosting India’s export performance. These agreements reduce trade barriers, making Indian products more competitive. As a result, exports to countries such as the Netherlands, Singapore, and the United States have seen significant upticks. Exports to Malaysia alone grew by over 50% during the April-July 2024 period, highlighting the impact of these strategic partnerships.
Despite rising imports, India has managed to reduce its trade deficit significantly from $121.6 billion in FY23 to $78.1 billion in FY24. This improvement is attributed to the steady growth in services exports and the moderation of merchandise imports. The narrowing deficit is a positive sign, indicating a more balanced trade environment and a healthier economic outlook. To sustain this export momentum, the Indian government has implemented several key initiatives. The Trade Infrastructure for Export Scheme (TIES) and Market Access Initiatives (MAI) Scheme are designed to enhance export infrastructure and reduce trade bottlenecks. Additionally, the Rebate of State and Central Levies and Taxes (RoSCTL) scheme focuses on supporting labour-intensive sectors, ensuring that Indian products remain competitively priced. These efforts, combined with streamlined regulations and improved market access information, are helping Indian exporters stay competitive in global markets. However, challenges like inflation, which can increase the cost of Indian goods abroad, remain a concern. Continued focus on improving competitiveness and simplifying bureaucratic processes will be crucial for sustaining growth. India’s recent export boom reflects a strategic shift toward diversifying its export basket and leveraging global market opportunities. By capitalizing on sectoral strengths, particularly in technology and services, and leveraging new trade agreements, India is poised to maintain its upward export trajectory. With sustained policy support and strategic investments, India is well-positioned to navigate the challenges of the global market and drive further economic growth in the coming years.
