Lok Sabha Question No. 2894 (UNSTARRED), answered on 2017-03-20
Subject: India’s Imports and Exports
Ministry: COMMERCE AND INDUSTRY
Asked by: KONDA VISHWESHWAR REDDY, ARVIND GANPAT SAWANT, RAMESH BIDHURI

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY (DEPARTMENT OF COMMERCE)

## LOK SABHA UNSTARRED QUESTION NO. 2894 TO BE ANSWERED ON 20 th  MARCH, 2017

## INDIA'S IMPORTS AND EXPORTS

## 2894.  SHRI KONDA VISHWESHWAR REDDY:

SHRI ARVIND SAWANT:

SHRI RAMESH BIDHURI:

Will the Minister of COMMERCE & INDUSTRY ( वािणÏय एवं उɮयोग मंत्री ) be pleased to state:

- (a) the details of total imports and exports of the country during the last three years and the current year indicating the difference between their percentage along with the target fixed for import and export achieved during the said period;
- (b) whether the country's trade deficit has widened during the said period and if so, the details thereof and  the reasons therefor along with the steps taken by  the Government to reduce it;
- (c) whether the demand for indigenous mechanical and technical goods has increased in foreign markets during the recent years and if so, the details thereof along with the reaction of the Government thereto;
- (d) whether the Government has directed its missions in various countries to explore trade  opportunities  and  if  so,  the  details  thereof  and  the  reports  received  by  the Government in this regard;
- (e) whether the Government has conducted any study on the effect of its adhoc export and import policy with respect to inflation in food commodities and if so, the details thereof; and
- (f) whether the Government is planning to design a stable export and import policy for food commodities in order to control the seasonal variation in the food inflation and if so, the details thereof?

## ANSWER

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## THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (INDEPENDENT CHARGE)

(SMT. NIRMALA SITHARAMAN)

- (a): The value of India's merchandise exports and imports during the last three years and the current year are as follows:

(in US$ Billions)

| Years              |   Exports | %Growth   |   Imports | %Growth   |
|--------------------|-----------|-----------|-----------|-----------|
| 2013-14            |    314.41 | --        |    450.22 | --        |
| 2014-15            |    310.34 | -1.29     |    448.03 | -0.49     |
| 2015-16            |    262.29 | -15.48    |    381.01 | -14.96    |
| 2015-16 (Apr-Jan)  |    218.53 | --        |    326.28 | --        |
| 2016-17 (Apr-Jan)* |    221.78 | 1.48      |    309.33 | -5.19     |

The value of merchandise export targets fixed and achieved is as follows:

| Years   | Export values (US$ Billions)   | Export values (US$ Billions)   | %Difference   |
|---------|--------------------------------|--------------------------------|---------------|
| Years   | Target fixed                   | Achievement                    | %Difference   |
| 2013-14 | 325                            | 314                            | -3.38         |
| 2014-15 | 340                            | 310                            | -8.82         |

Source: Annual Report of Department of Commerce

As per Foreign Trade Policy 2015-20, the Government aims to increase India's exports of merchandise  and  services  from  US$  465.9  billions  to  approximately  US$  900  billions  by 2019-20 and to raise India's share in world exports (Goods and Services) from 2% to 3.5%.

## (b): India's trade deficit for the last three years and the current year are as follows:

(in US$ Billions)

| Years              |   Exports |   Imports |   Trade Deficit | %Growth   |
|--------------------|-----------|-----------|-----------------|-----------|
| 2013-14            |    314.41 |    450.22 |         -135.81 |           |
| 2014-15            |    310.34 |    448.03 |         -137.69 | 1.39      |
| 2015-16            |    262.29 |    381.01 |         -118.72 | -13.78    |
| 2015-16 (Apr-Jan)  |    218.53 |    326.28 |         -107.75 | --        |
| 2016-17 (Apr-Jan)* |    221.78 |    309.33 |          -87.55 | -18.74    |

Source: DGCI&S, Kolkata (* Provisional)

The above data reveals that there is a small increase in the trade  deficit  during  the  period 2014-15 over 2013-14. However, the trade gap has decreased in 2015-16 and the current year compared to corresponding period of previous year.

The  Government  has  taken  following  measures  to  improve  the  trade  deficit  with  other countries:

- (i) The Merchandise Exports from India Scheme (MEIS) was introduced in the Foreign Trade Policy (FTP) 2015-20 on April 1, 2015 and is a major export promotion scheme implemented by the Ministry of Commerce and Industry. MEIS aims to incentivize export of merchandise which is produced/ manufactured in India. Rewards @ 2-5% under MEIS are payable as a percentage of realized FOB value of covered exports, by way of the MEIS duty credit scrip, which are transferable and can also be used for payment  of  a  number  of  duties  including  the  basic  customs  duty. At  present,  7914 tariff lines at 8 digit HS Codes are covered under MEIS scheme.
- (ii) The Government has also launched Services Exports from India Scheme (SEIS) in the FTP 2015-2020.  The Scheme provided rewards to service providers of notified services who are providing service from India. The rate of reward under the scheme would be based on net foreign exchange earned. The present rates of reward are 3% and 5%.
- (iii) The  Government  is  implementing  the  Niryat  Bandhu  Scheme  with  an  objective  to reach out to the new and potential exporters including exporters from Micro, Small & Medium  Enterprises  (MSMEs)  and  mentor  them  through  orientation  programmes,

counseling  sessions,  individual  facilitation,  etc.,  on  various  aspects  of  foreign  trade for being able to get into international trade and boost exports from India.

- (iv) By way of trade facilitation and enhancing the ease of doing business, Government reduced the number of mandatory documents required for exports and imports to three each, which is comparable with international benchmarks. The trade community can file  applications  online  for  various  trade  related  schemes.  Online  payment  of application  fees  through  Credit/Debit  cards  and  electronic  funds  transfer  from  53 Banks has been put in place.
- (v) Interest  Equalization  Scheme  on  pre  &  post  shipment  credit  launched  to  provide cheaper credit to exporters.
- (vi) Further, the Government continues to provide the facility of access to duty free raw materials and capital goods for exports through schemes like Advance Authorization, Duty  Free  Import  Authorization  (DFIA),  Export  Promotion  Capital  Goods  (EPCG) and drawback / refund of duties.
- (c): A comparison of export data of engineering goods during the period 2016-17 (April January) as compared to the corresponding period in 2015-16 indicates positive growth in mechanical and technical goods like electrical machinery, auto and auto components, ships and boats, Railway Transport etc. The details of export of engineering goods are as follows:

(in US$ millions)

| Product categories                          |   2014-15 |   2015-16 (Apr- Jan) |   2016-17 (Apr- Jan)* |   %Growth |
|---------------------------------------------|-----------|----------------------|-----------------------|-----------|
| Industrial machinery                        |  11418.1  |              8944.65 |               8824.69 |     -1.34 |
| Electrical machinery                        |   3965.82 |              3042.33 |               3729.86 |     22.6  |
| Auto and Auto Components                    |  12851.6  |             10484.4  |              10951.2  |      4.45 |
| Aircrafts and Spacecraft parts and products |   6159.17 |              3314.27 |               2435.27 |    -26.52 |
| Ships Boats and Floating products and parts |   5352.61 |              2660.69 |               2872.24 |      7.95 |
| Medical and Scientific instruments          |   1276.44 |               978.59 |               1125.97 |     15.06 |
| Railway Transport                           |    133.54 |                71.1  |                173.79 |    144.43 |
| Hand tools and cutting tools                |    755.71 |               541.31 |                526.04 |     -2.82 |
| Electrodes, Accumulators                    |     38.58 |                35.74 |                 33.52 |     -6.21 |
| Accumulator and Batteries                   |    212.78 |               166.13 |                186.39 |     12.2  |
| Bicycle &Parts                              |    354.08 |               244.73 |                239.51 |     -2.13 |
| Cranes Lifts &Winches                       |    341.73 |               311.76 |                328.82 |      5.47 |
| Office Equipments                           |     54.29 |                71.36 |                100.6  |     40.98 |
| Other construction machinery                |   1177.31 |               894.66 |                823.56 |     -7.95 |
| Total                                       |  44091.8  |             31761.7  |              32351.5  |      1.86 |

Source: DGCI&S, Kolkata (* Provisional)

(d): Efforts are continuously made through missions abroad to increase overall exports by diversifying the trade basket with emphasis on manufactured goods, services, resolution of market access issues and other non-tariff barriers.

- (e): No such study has been conducted.

(f): While framing the export and import policies for the agricultural products, including the  food  commodities  the  Government  takes  several  factors  into  consideration  such  as availability  of  surplus  over  and  above  the  requirement  of  buffer  stock  including  strategic reserve, if any, concerns of food security, diplomatic/humanitarian considerations, international demand and supply situation, quality standards, varieties traded, price competitiveness, need to balance between remunerative prices to the growers and availability of agricultural products to common man at affordable prices etc. The Government strives to maintain a consistent and stable export and import policy for the food commodities, taking into consideration the interests of all the stakeholders.

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