India’s merchandise Exports, Imports as well as Trade Deficit during the last three years have shown a mixed trend as evident from the table below:-
Values in US $ Billion
Trade Deficit as % of GDP
*Source: CSO, New Series Estimates( 2012-13, 2013-14), DGCI&S
It would be seen from the Table above that Trade Deficit as % of GDP has shown a continuously declining trend. The major contributors for the trade deficit are imports of Petroleum and Gold (contributing for nearly 80% or more of total trade deficit). Whereas the import of Petroleum is critical for the growth of economy and meeting the energy needs of the country, the government introduces various policy measures from time to time, for managing imports of gold, keeping in view the overall economic and Current Account Deficit (CAD) situation of the country.
The government has taken a number of measures to restore the positive growth rate in exports and manage imports, in order to manage the Trade deficit. The main steps taken are:
i) Government performs import appraisal to evaluate the quantum of imports on a periodic basis. In order to control imports of gold and silver the Government gradually increased customs duty on gold from 2 per cent in January 2012 to 10 per cent in August 2013. In the month of April, 2015, the Government raised import tariff value of gold to $388 per 10g from $375 per 10g and of silver to $524 per Kg from $512 per Kg.
ii) Government has recently released the Foreign Trade Policy (FTP) 2015-20, which has introduced two new schemes, namely, ‘Merchandise Exports from India Scheme’ (MEIS) for incentivising export of specified goods to specified markets and ‘Service Exports from India Scheme’ (SEIS) for increasing exports of notified services from India for diversification of India’s export markets and products and give a boost to India’s exports. This also includes goods and services from MSME Sector.
iii) The Foreign Trade Policy 2015-20 has also introduced several measures for facilitating trade and improving `Ease of doing business’ by reducing the number of mandatory documents required for export and import to three each. In order to facilitate faster processing and enable working in 24*7 mode, DGFT has facilitated submission of various applications and documents in online mode, as well as online payment of application fees through credit/debit cards and electronic fund transfer from 53 banks. CBEC has also facilitated integration of Plant Quarantine and FSSAI with EDI system of Customs, for purposes of export and import. These measures will facilitate trade by reducing transaction cost and time.
iv) In order to provide Indian exporters better access to various markets, the government is engaged in regional, bilateral and multilateral trade negotiations with various countries and trade blocks.
v) In order to promote exports, the State governments have been requested to develop their export strategy, appoint export commissioners, address infrastructure constraints restricting movement of goods, facilitate refund of VAT/Octroi/State level cess, and address other issues relating to various clearances etc. and build capacity of new exporters.
vi) The government continuously monitors the export performance of different sectors to different countries and takes need based measures from time to time, keeping in view the emerging global financial situation and overall economic implications.
The quantity of incense sticks exported during the last three years are as under: (Quantity in thousand kgs)
The top ten countries to which the incense sticks have been exported are United States of America, Ethiopia, Nigeria, Egypt, United Arab Emirates, Nepal, Brazil, Malaysia, Chile and Iran.
This information was given by the Minister of State (Independent Charge) in the Ministry of Commerce & Industry Smt. Nirmala Sitharaman in a written reply in Rajya Sabha
SOURCE - PIB