India can promote 233 items whose exports have grown at 14% CAGR in 9 years

The All India Association of Industries (AIAI) has been representing the interests of trade, industry and employment since 1956. We are pleased to make following submissions on the above subject for your kind consideration.

Government of India can provide specific policy thrust on 233 items whose exports have grown at a compounded annual growth rate (CAGR) of 14% in the last nine years (from 2010-11 to 2019-20). Exports of these goods have grown at double digit despite India’s overall merchandise exports growing at hardly 3% during this period. India’s export of these 233 items more than trebled from USD 26 billion in 2010-11 to USD 83.7 billion in 2019-20. On the other hand, overall merchandise exports grew hardly from USD 249 billion to USD 313 billion during this period. Thus, the share of these 233 items in India’s overall exports more than doubled from 11% to 27% in the period under review.

These 233 products, classified at the 8-digit HS Code, fall under the broad categories of cotton textile, pharmaceuticals, iron and steel products, organic chemicals, processed food, electrical & mechanical equipment’s, vehicles and ships & floating structures. Some of these products also fall under plastic, leather products, carpets and essential oils categories.

Trade deficit to Surplus

Out of these 233 items, India had trade deficit of USD 6 billion in 71 items in 2010-11. However, by 2019-20, India managed to transform this deficit into surplus by growing exports of these 71 items more than four times from USD 4.6 billion to USD 20.07 billion in this period. Today, India has a trade surplus of USD 12 billion in these 71 items. These 71 items include mobile phones, auto-components, organic chemicals, iron & steel products, iron ore pellets and electrical equipment’s.

The following table provides the list of 10 auto-components and parts used in other transport vehicles. Exports of these items more than doubled from USD 2.29 billion to USD 4.8 billion in the last nine years and this helped us transform the trade deficit of USD 1.09 billion in these 10 goods to a surplus of USD 2.6 billion by 2019-20.

The other major sector that witnessed strong growth in exports is electronics and electrical equipment’s. As the following table shows, exports of seven items under this category grew around eight times from USD 270 million to USD 2.18 billion by 2019-20. Principal among them is mobile phones, whose exports has grown from hardly USD 16 million to USD 961 million. Growth in the export of mobile phone is the outcome of the sharp increase in the number of mobile phone manufacturing units in India in response to the Make in India campaign. According to Union Minister for Electronics and IT Mr. Ravi Shankar Prasad, India has emerged as the second largest mobile phone producer in the world with the number of manufacturing units growing from 2 to 200 in the last five years.

India has also enhanced export of organic chemicals, dyes & intermediates in the last nine years. The following table provides the list of 13 major chemical products that have registered more than six times growth in exports since 2010-11. Today, India exports USD 4.03 billion worth of these 13 chemical products.