Trends in India’s Foreign Trade

For any country’s economic development, foreign trade is a very significant part. It
contributes to the Gross Domestic Product (GDP) of the country as the balance
of trade is one of the key components of a country’s GDP. Also,
International trade helps each country to make optimum use of its natural resources
and irons out wild fluctuations in prices. It brings in foreign exchange and increases
competition among producers which helps them to produce even more good
product.

India is a very old participant in world trade. Its participation have been promoted
by the opening of Suez Canal and speedy development of the ship building industry
supplemented by the spread of industrial revolution in Europe and fast expansion of
Indian railways.Foreign trade in India comprises of all imports and exports to and
from India. And due to the pandemic situation, recently there has been many
changes in the percentage of exports as well as imports.

Current Exports: India's overall exports (Merchandise and Services combined) in

April-January 2020-21* are estimated to be USD 396.60 Billion, exhibiting a
negative growth of (-) 10.63 per cent over the same period last year.

Current Imports: Imports in January 2021 were USD 41.99 billion which is an
increase of 2.03% in Dollar terms and 4.60% in Rupee terms over imports of USD
41.15 billion in January 2020.

Trade in Goods-

Exports

▪Exports inJanuary2021 were USD27.45Billion, as compared to USD25.85Billion in

January 2020, exhibiting a positive growth of 6.16per cent. In Rupee terms, exports
were Rs. 2,00,661.11Crore in January2021, as compared to Rs. 1,84,369.73Crore in
January2020, registering a positive growth of 8.84per cent.

▪The commodities/commodity groups which have recorded negative growth during

January 2021 vis-à-vis January 2020are Petroleum products (-32.06%), Leather &
leather products (-18.6%), RMG of all Textiles (-10.73%), Man-made
yarn/fabs./made-ups etc. (-9.62%), Meat, dairy & poultry products (-8.03%), Oil
seeds (-6.49%), Marine products (-1.72%) and Gems & jewellery (-1.26%).

Imports
Imports in January2021 were USD41.99Billion (Rs.3,06,951.56Crore), which is an
increase of2.03per cent in Dollar terms and 4.60per cent in Rupee terms over
imports of USD41.15Billion (Rs2,93,452.69Crore) in January2020.
Major commodity groups of import showing negative growth in January2021 over
the corresponding month of last year are:
- Petroleum, Crude and Products (-27.72%)
- Transport Equipment (-25.26%)
- Fertilisers, Crude and manufactured (-11.57%)
- Metaliferrous ores and other minerals (-4.57%)
-Machinery, electrical and non-electrical (-1.37%)

Trade in Services-

Exports(Receipts)

▪ As per the latest press release by RBI dated 15th February 2021, exports in
December2020 were USD 18.72Billion (Rs.1,37,774.58Crore) registering a
negative growth of (-) 6.41per cent in Dollar terms, vis-à-vis December2019.
The estimated value of services export for January2021* is USD 19.25Billion

Imports(Payments)

▪ As per the latest press release by RBI dated 15th February 2021, imports in
December 2020 were USD 11.50Billion (Rs. 84,632.64Crore) registering a
negative growth of (-) 8.40per cent in Dollar terms, vis-à-vis December2019.
The estimated value of services import for January2021* is USD 12.03Billion.

India has great a contribution in overall Foreign trade activities India has engaged
herself, constructively in multilateral trade negotiations under the WTO. India has
forcefully articulated its position which reflects the concerns of the
developing countries. Reforms in the trade policy regime have resulted in growth of
India’s foreign trade. An important aspect of the trade of a country is its
composition.
To maintain its international trade and to enhance its global growth, Indian
government is taking many initiatives as well and is coming across several
agreements with the other countries.