Lok Sabha Question No. 101 (STARRED), answered on 2017-07-24
Subject: Trade Deficit
Ministry: COMMERCE AND INDUSTRY
Asked by: KAPIL MORESHWAR PATIL

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

## LOK SABHA STARRED QUESTION NO. 101(H) TO BE ANSWERED ON 24 th   JULY, 2017

## TRADE DEFICIT

## *101(H). SHRI KAPIL MORESHWAR PATIL:

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

- (a) whether it is a fact that the exports have drastically come down due to which the foreign trade deficit has reached an alarming level during the last six months of the current year;
- (b) if so, the details thereof, sector-wise and the reasons therefor;
- (c) the  names  of  countries  with  which  India  has  registered  favourable  trade  balance during the last three years and the current year, sector and year-wise;
- (d) the names of those countries with which India has registered trade deficit during the said period, sector and year-wise; and
- (e) the steps taken/being taken by the Government to overcome the trade deficit?

## ANSWER

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THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (INDEPENDENT CHARGE) (SMT. NIRMALA SITHARAMAN)

- a) to  e):  A Statement is laid on the Table of the House.

*****

## STATEMENT REFERRED TO IN REPLY TO PARTS (a) TO (e) OF LOK SABHA STARRED QUESTION NO. 101   FOR ANSWER ON 24 TH  JULY, 2017 REGARDING 'TRADE DEFICIT'.

- (a) & (b): Total value of exports (merchandise and services) of India with other countries during the last six months is as follows:

| Months         |   Value of exports (in US$ Billions) |   %growth over corresponding month of previous year |
|----------------|--------------------------------------|-----------------------------------------------------|
| December,2016  |                                37.84 |                                                3.3  |
| January, 2017  |                                35.86 |                                                6.17 |
| February, 2017 |                                38.6  |                                               16.36 |
| March, 2017    |                                43.09 |                                               20.35 |
| April, 2017    |                                37.53 |                                               11.03 |
| May, 2017      |                                37.44 |                                                4.4  |

Source: DGCI&S, Kolkata

The above data reflects that India's export has maintained the positive growth during the last six months as compared to exports of corresponding months of previous years.

- (c): The names of the top 25 countries with which India has registered favourable trade balance during the last three years and the current year are given at Annexure-I. The top 25 Principal  Commodities  in  which  India  has  favourable  trade  balance  during  the  last  three years and the current year are given at Annexure-II .
- (d): The  names  of  the  top  25  countries  with  which  India  has  registered  trade  deficit during  the  last  three  years  and  the  current  year  are  given  at Annexure-III. The  top  25 Principal Commodities in which India has trade deficit during the last three years and the current year are given at Annexure-IV .
- (e): The Government has taken the following steps to overcome the trade deficit:
- (i) The New Foreign Trade Policy (2015 -20) was  announced on 1 st April,  2015  with  a focus on supporting both manufacturing and services exports.
- (ii) The Merchandise  Exports  from  India  Scheme  (MEIS) has  been  introduced  in  the Foreign  Trade  Policy  (FTP)  2015-20  on  01.04.2015  with the  objective  to  offset infrastructural inefficiencies and associated costs involved in exporting goods/products which are produced/ manufactured in India and to provide a level playing  field  to  Indian  exporters,  especially  those  having  high  export  intensity  and employment  potential.  The  Scheme  incentivizes exporters in terms  of freely

transferable Duty Credit Scrips which are transferable and can be used to pay certain Central duties/taxes including customs duties.  The Scheme covers exports of 7914 tariff lines at 8 digit levels to all countries.

- (iii) The Services Exports from India Scheme (SEIS) has been introduced in the Foreign Trade Policy (FTP) 2015-20 on 01.04.2015. The Scheme provides rewards at the rate of 3 to 5% on Net Foreign Exchange earnings, to service providers of notified services from  India  to  rest  of  the  world,  in  the  form  of  Duty  Credit  Scrips which  are transferable and can be used to pay certain Central duties/taxes including customs duties.
- (iv) The Government has implemented 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.
- (v) As  part  of  the  ' Ease  of  Doing  Business '  initiatives,  the  Government  has  launched Single Window Interface for Facilitating Trade (SWIFT) clearances project w.e.f 1 st April, 2016. The scheme enables the importers/exporters to file a common electronic 'Integrated Declaration' on the Indian Customs Electronic Commerce/Electronic Data Interchange  (EC/EDI)  Gateway  i.e.  ICEGATE  portal.  The  Integrated  Declaration compiles the information requirements of Customs, FSSAI, Plant Quarantine, Animal Quarantine,  Drug  Controller,  Wild  Life  Control  Bureau  and  Textile  Committee.  It replaces nine separate forms required by these 6 different agencies and Customs.
- (vi) Interest  Equalization  Scheme  on  pre  &  post  shipment  credit was  launched  to provide cheaper credit to exporters.
- (vii) A new scheme called Special Advance Authorisation Scheme for export of articles of Apparel and Clothing Accessories was introduced w.e.f. 1st September 2016 wherein exporters are entitled for an authorisation for fabrics including inter lining on preimport  basis  and  all  industry  rate  of  Duty  Drawback  for  non-fabric  inputs  on  the exports.
- (viii) 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.
- (ix) The  Government  launched  a  new  scheme  called Trade  Infrastructure  for  Export Scheme  (TIES) w.e.f.  15 th March,  2017  with  the  objective  to  enhance  export competitiveness  by  bridging  gaps  in  export  infrastructure,  creating  focused  export infrastructure, first mile and last mile connectivity for export oriented projects and addressing  quality  and  certification  measures.  The  Central  and  State  Agencies, including Export Promotion Councils, Commodities Boards, SEZ Authorities and Apex

Trade Bodies recognised under the EXIM policy of Government of India are eligible for financial support under this scheme.

- (x) The Government has approved the proposal for notification of commitments under the Trade  Facilitation  Agreement  (TFA) of  World  Trade  Organization  (WTO), ratification and acceptance of the Instrument of Acceptance of Protocol of TFA to the WTO Secretariat and constitution  of  the  National  Committee  on  Trade  Facilitation (NCTF). The Trade Facilitation Agreement (TFA) contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures  for effective cooperation between  customs  and  other appropriate authorities on trade facilitation and customs compliance issues. These objectives are in consonance with India's 'Ease of Doing Business' initiative.

***

## Statement referred to in reply of part (c) of Lok Sabha Starred Question no. 101 for answer on 24 th July 2017.

| Top 25 Countries with which India has favourable Trade Balance   | Top 25 Countries with which India has favourable Trade Balance   | Top 25 Countries with which India has favourable Trade Balance   | Top 25 Countries with which India has favourable Trade Balance   | Top 25 Countries with which India has favourable Trade Balance   |
|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|
| S. No.                                                           | 2014-15 2015-16                                                  | 2016-17                                                          | 2017-18 (Apr-May)*                                               |                                                                  |
| 1 U S A                                                          | U S A                                                            | U S A                                                            | U S A                                                            |                                                                  |
| 2 Hong Kong                                                      | U Arab Emts                                                      | U Arab Emts                                                      | U Arab Emts                                                      |                                                                  |
| 3 U Arab Emts                                                    | Hong Kong                                                        | Bangladesh Pr                                                    | Bangladesh Pr                                                    |                                                                  |
| 4 Sri Lanka DSR                                                  | Bangladesh Pr                                                    | Hong Kong                                                        | Nepal                                                            |                                                                  |
| 5 Bangladesh PR                                                  | Sri Lanka DSR                                                    | Nepal K                                                          | U                                                                |                                                                  |
| 6 U K                                                            | U K                                                              | U K                                                              |                                                                  |                                                                  |
| 7 Kenya                                                          | Nepal                                                            | Vietnam Soc Rep Sri                                              | Turkey Lanka DSR                                                 |                                                                  |
| Nepal                                                            | Turkey                                                           | Turkey Egypt                                                     | 8 A RP                                                           |                                                                  |
| 9 Turkey                                                         | Kenya                                                            | Sri Lanka DSR Netherland                                         |                                                                  |                                                                  |
| 10 Netherland                                                    | Netherland                                                       | Netherland                                                       | Kenya                                                            |                                                                  |
| Vietnam Soc Rep                                                  | Vietnam Soc Rep                                                  | Singapore Italy                                                  | 11                                                               |                                                                  |
| Singapore                                                        | Pakistan Ir                                                      | Kenya France                                                     | 12                                                               |                                                                  |
| 13 Mauritius                                                     | Spain                                                            | Spain                                                            | Vietnam Soc Rep                                                  |                                                                  |
| Mozambique                                                       | Gibraltar                                                        | Oman Singapore                                                   | 14                                                               |                                                                  |
| 15 Tanzania Rep                                                  | Egypt A Rp                                                       | Pakistan Ir                                                      | Mauritius                                                        |                                                                  |
| 16 Pakistan Ir                                                   | France                                                           | Gibraltar                                                        | Spain                                                            |                                                                  |
| 17 Egypt A RP                                                    | Mozambique                                                       | Israel                                                           | Pakistan Ir                                                      |                                                                  |
| 18 Spain                                                         | Mauritius                                                        | Italy                                                            | Oman                                                             |                                                                  |
| 19 Philippines                                                   | Philippines                                                      | Philippines                                                      | Hong Kong                                                        |                                                                  |
| 20 Israel                                                        | Ethiopia                                                         | Egypt A Rp                                                       | Israel                                                           |                                                                  |
| 21 Italy                                                         | Tanzania Rep                                                     | Mauritius                                                        | Ethiopia                                                         |                                                                  |
| 22 Ethiopia                                                      | Israel                                                           | Tanzania Rep                                                     | Poland                                                           |                                                                  |
| Gibraltar                                                        | Sudan                                                            | Ethiopia Mexico                                                  | 23                                                               |                                                                  |
| 24 Oman                                                          | Mexico                                                           | Portugal                                                         | Somalia                                                          |                                                                  |
| Jordan                                                           | Uganda                                                           | Mexico Sudan                                                     | 25                                                               |                                                                  |

Source: DGCI&S, Kolkata (*Provisional)

Annexure-II

## Statement referred to in reply of part (c) of Lok Sabha Starred Question no. 101 for answer on 24 th July 2017.

| Top 25 Principal Commodities in which India has favourable Trade Balance   | Top 25 Principal Commodities in which India has favourable Trade Balance   | Top 25 Principal Commodities in which India has favourable Trade Balance   | Top 25 Principal Commodities in which India has favourable Trade Balance   | Top 25 Principal Commodities in which India has favourable Trade Balance   |
|----------------------------------------------------------------------------|----------------------------------------------------------------------------|----------------------------------------------------------------------------|----------------------------------------------------------------------------|----------------------------------------------------------------------------|
| S.No.                                                                      | 2014-15                                                                    | 2015-16                                                                    | 2016-17                                                                    | 2017-18 (Apr-May)*                                                         |
| 1                                                                          | Petroleum Products                                                         | Petroleum Products                                                         | Petroleum Products                                                         | Petroleum Products                                                         |
| 2                                                                          | Gold And Other Precious Metal Jewellery                                    | Drug Formulations, Biologicals                                             | Gold And Other Precious Metal Jewellery                                    | Gold And Other Precious Metal Jewellery                                    |
| 3                                                                          | Drug Formulations, Biologicals                                             | Gold And Other Precious Metal Jewellery                                    | Drug Formulations, Biologicals                                             | Drug Formulations, Biologicals                                             |
| 4                                                                          | Rmg Cotton Incl Accessories                                                | Rmg Cotton Incl Accessories                                                | Rmg Cotton Incl Accessories                                                | Rmg Cotton Incl Accessories                                                |
| 5                                                                          | Motor Vehicle/Cars                                                         | Motor Vehicle/Cars                                                         | Motor Vehicle/Cars                                                         | Motor Vehicle/Cars                                                         |
| 6                                                                          | Marine Products                                                            | Cotton Fabrics, Madeups Etc.                                               | Marine Products                                                            | Rmg Manmade Fibres                                                         |
| 7                                                                          | Cotton Fabrics, Madeups Etc.                                               | Marine Products                                                            | Rmg Manmade Fibres                                                         | Marine Products                                                            |
| 8                                                                          | Buffalo Meat                                                               | Buffalo Meat                                                               | Cotton Fabrics, Madeups Etc.                                               | Cotton Fabrics, Madeups Etc.                                               |
| 9                                                                          | Rice -Basmati                                                              | Rmg Manmade Fibres                                                         | Buffalo Meat                                                               | Rice -Basmoti                                                              |
| 10                                                                         | Cotton Yarn                                                                | Cotton Yarn                                                                | Rmg Of Other Textile Matrl                                                 | Ship, Boat And Floating Struct                                             |
| 11                                                                         | Rmg Manmade Fibres                                                         | Rice -Basmoti                                                              | Cotton Yarn                                                                | Rmg Of Other Textile Material                                              |
| 12                                                                         | Products Of Iron And Steel                                                 | Rmg Of Other Textile Material                                              | Rice -Basmoti                                                              | Buffalo Meat                                                               |
| 13                                                                         | Manmade Yarn, Fabrics, Madeups                                             | Manmade Yarn, Fabrics, Madeups                                             | Manmade Yarn, Fabrics, Madeups                                             | Manmade Yarn, Fabrics, Madeups                                             |
| 14                                                                         | Rice(Other Than Basmati)                                                   | Products Of Iron And Steel                                                 | Rice(Other Than Basmati)                                                   | Products Of Iron And Steel                                                 |
| 15                                                                         | Rmg Of Other Textile Matrl                                                 | Rice(Other Than Basmoti)                                                   | Products Of Iron And Steel                                                 | Cotton Yarn                                                                |
| 16                                                                         | Pearl, Precious, Semiprecious Stones                                       | Pearl, Precious, Semiprecious Stones                                       | Spices                                                                     | Rice(Other Than Basmati)                                                   |
| 17                                                                         | Footwear Of Leather                                                        | Footwear Of Leather                                                        | Footwear Of Leather                                                        | Spices                                                                     |
| 18                                                                         | Two And Three Wheelers                                                     | Two And Three Wheelers                                                     | Dyes                                                                       | Two And Three Wheelers                                                     |
| 19                                                                         | Dyes                                                                       | Spices                                                                     | Two And Three Wheelers                                                     | Granit, Natural Stone And Product                                          |
| 20                                                                         | Spices                                                                     | Dyes                                                                       | Carpet(Excl. Silk) Handmade                                                | Footwear Of Leather                                                        |
| 21                                                                         | Guergam Meal                                                               | Cotton Raw Incld. Waste                                                    | Granit, Natural Stone And Product                                          | Dyes                                                                       |
| 22                                                                         | Granit, Natural Stone And Product                                          | Carpet(Excl. Silk) Handmade                                                | Leather Goods                                                              | Carpet(Excl. Silk) Handmade                                                |
| 23                                                                         | Aircraft, Spacecraft And Parts                                             | Granit, Natural Stone And Product                                          | Pearl, Precious, Semiprecious Stones                                       | Iron And Steel                                                             |
| 24                                                                         | Cotton Raw Include. Waste                                                  | Leather Goods                                                              | Iron Ore                                                                   | Iron Ore                                                                   |
| 25                                                                         | Leather Goods                                                              | Agro Chemicals                                                             | Handicrafts(Excl. Handmade Carpets)                                        | Leather Goods                                                              |

Source: DGCI&S, Kolkata (*Provisional)

Annexure-III

## Statement referred to in reply of part (d) of Lok Sabha Starred Question no. 101 for answer on 24 th July 2017.

| Top 25 Countries with which India has trade deficit   | Top 25 Countries with which India has trade deficit   | Top 25 Countries with which India has trade deficit   | Top 25 Countries with which India has trade deficit   | Top 25 Countries with which India has trade deficit   |
|-------------------------------------------------------|-------------------------------------------------------|-------------------------------------------------------|-------------------------------------------------------|-------------------------------------------------------|
| S.No.                                                 | 2014-15                                               | 2015-16                                               | 2016-17                                               | 2017-18 (Apr-May)*                                    |
| 1                                                     | China P Rp                                            | China P Rp                                            | China P Rp                                            | China P Rp                                            |
| 2                                                     | Switzerland                                           | Switzerland                                           | Switzerland                                           | Switzerland                                           |
| 3                                                     | Saudi Arab                                            | Saudi Arab                                            | Saudi Arab                                            | Saudi Arab                                            |
| 4                                                     | Qatar                                                 | Indonesia                                             | Iraq                                                  | Indonesia                                             |
| 5                                                     | Iraq                                                  | Iraq                                                  | Indonesia                                             | Iraq                                                  |
| 6                                                     | Kuwait                                                | Korea Rp                                              | Korea Rp                                              | Korea Rp                                              |
| 7                                                     | Venezuela                                             | Qatar                                                 | Australia                                             | Australia                                             |
| 8                                                     | Nigeria                                               | Nigeria                                               | Iran                                                  | Nigeria                                               |
| 9                                                     | Indonesia                                             | Unspecified                                           | Qatar                                                 | Iran                                                  |
| 10                                                    | Korea Rp                                              | Australia                                             | Japan                                                 | Russia                                                |
| 11                                                    | Australia                                             | Venezuela                                             | Nigeria                                               | Qatar                                                 |
| 12                                                    | Malaysia                                              | Malaysia                                              | Venezuela                                             | Japan                                                 |
| 13                                                    | Belgium                                               | Japan                                                 | Unspecified                                           | Venezuela                                             |
| 14                                                    | Germany                                               | Germany                                               | Germany                                               | Kuwait                                                |
| 15                                                    | Iran                                                  | Kuwait                                                | Malaysia                                              | Unspecified                                           |
| 16                                                    | Japan                                                 | Iran                                                  | Russia                                                | Germany                                               |
| 17                                                    | Angola                                                | Belgium                                               | Kuwait                                                | South Africa                                          |
| 18                                                    | Unspecified                                           | Russia                                                | Angola                                                | Malaysia                                              |
| 19                                                    | Chile                                                 | Angola                                                | South Africa                                          | Thailand                                              |
| 20                                                    | Thailand                                              | Thailand                                              | Thailand                                              | Canada                                                |
| 21                                                    | Russia                                                | South Africa                                          | Ukraine                                               | Ghana                                                 |
| 22                                                    | Ukraine                                               | Ghana                                                 | Canada                                                | Belgium                                               |
| 23                                                    | Taiwan                                                | Canada                                                | Argentina                                             | Argentina                                             |
| 24                                                    | Canada                                                | Argentina                                             | Brazil                                                | Botswana                                              |
| 25                                                    | Argentina                                             | Taiwan                                                | Ghana                                                 | Ukraine                                               |

Source: DGCI&S, Kolkata (*Provisional)

Annexure-IV

## Statement referred to in reply of part (d) of Lok Sabha Starred Question no. 101 for answer on 24 th July 2017.

| Top 25 Principal Commodities in which India has trade deficit   | Top 25 Principal Commodities in which India has trade deficit   | Top 25 Principal Commodities in which India has trade deficit   | Top 25 Principal Commodities in which India has trade deficit   | Top 25 Principal Commodities in which India has trade deficit   |
|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|-----------------------------------------------------------------|
| S.No.                                                           | 2014-15                                                         | 2015-16                                                         | 2016-17                                                         | 2017-18 (Apr-May)*                                              |
| Petroleum: Crude                                                | Petroleum: Crude                                                | Petroleum:                                                      | Crude Petroleum: Crude                                          | 1                                                               |
| Gold                                                            | Gold                                                            | Gold                                                            | Gold                                                            | 2                                                               |
| Coal, Coke and Briquittes Etc                                   | Telecom Instruments                                             | Coal, Coke and Briquittes Etc                                   | Coal, Coke and Briquittes Etc                                   | 3                                                               |
| Telecom Instruments                                             | Coal, Coke and Briquittes Etc                                   | Telecom Instruments                                             | Telecom Instruments                                             | 4                                                               |
| Vegetable Oils                                                  | Vegetable Oils                                                  | Vegetable Oils                                                  | Pearl, Precs, Semiprecs Stones                                  | 5                                                               |
| Other Commodities                                               | Computer Hardware, Peripherals                                  | Other Commodities                                               | Vegetable Oils                                                  | 6                                                               |
| Computer Hardware, Peripherals                                  | Fertilezers Manufactured                                        | Computer Hardware, Peripherals                                  | Electronics Components                                          | 7                                                               |
| Plastic Raw Materials                                           | Other Commodities                                               | Electronics Components                                          | Plastic Raw Materials                                           | 8                                                               |
| Fertilezers Manufactured                                        | Plastic Raw Materials                                           | Plastic Raw Materials                                           | Computer Hardware, Peripherals                                  | 9                                                               |
| Bulk Minerals and Ores                                          | Iron And Steel                                                  | Aircraft, Spacecraft and Parts                                  | Organic Chemicals                                               | 10                                                              |
| Organic Chemicals                                               | Electronics Components                                          | Organic Chemicals                                               | Other Commodities                                               | 11                                                              |
| Silver                                                          | Indl. Machinery For Dairy Etc                                   | Indl. Machinery For Dairy Etc                                   | Indl. Machinery For Dairy Etc                                   | 12                                                              |
| Indl. Machinery For Dairy Etc                                   | Organic Chemicals                                               | Fertilezers Manufactured                                        | Electronics Instruments                                         | 13                                                              |
| Inorganic Chemicals                                             | Bulk Minerals And Ores                                          | Pulses                                                          | Silver                                                          | 14                                                              |
| Iron And Steel                                                  | Electronics Instruments                                         | Electronics Instruments                                         | Bulk Minerals And Ores                                          | 15                                                              |
| Project Goods                                                   | Inorganic Chemicals                                             | Bulk Minerals And Ores                                          | Fertilezers Manufactured                                        | 16                                                              |
| Electronics Instruments                                         | Silver                                                          | Consumer Electronics                                            | Inorganic Chemicals                                             | 17                                                              |
| Electronics Components                                          | Pulses                                                          | Inorganic Chemicals                                             | Consumer Electronics                                            | 18                                                              |
| Consumer Electronics                                            | Consumer Electronics                                            | Medical And Scientific Instrum                                  | Pulses                                                          | 19                                                              |
| Pulses                                                          | Ac, Refrigeration Machinery Etc                                 | Project Goods                                                   | Ac, Refrigeration Machinery Etc                                 | 20                                                              |
| Medical And Scientific Instrum                                  | Project Goods                                                   | Ac, Refrigeration Machnry Etc                                   | Medical And Scientific Instrum                                  | 21                                                              |
| Electric Machinery And Equipment                                | Electric Machinery And Equipment                                | Silver                                                          | Residual Chemical And Allied Prod                               | 22                                                              |
| Other Wood And Wood Products                                    | Medical And Scientific Instrum                                  | Machine Tools                                                   | Project Goods                                                   | 23                                                              |
| Ac, Refrigeration Machinery Etc                                 | Residual Chemical And Allied Prod                               | Electric Machinery And Equipment                                | Electric Machinery And Equipment                                | 24                                                              |
| Machine Tools                                                   | Machine Tools                                                   | Paper, Paper Board And Product                                  | Copper And Products Made Of Copr                                | 25                                                              |

Source: DGCI&S, Kolkata (*Provisional)