Lok Sabha Question No. 3879 (UNSTARRED), answered on 2025-08-12
Subject: Strengthening India’s Global Trade Position
Ministry: COMMERCE AND INDUSTRY
Asked by: Thiru Arun Nehru

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

## LOK SABHA UNSTARRED QUESTION No. 3879 ANSWERED ON 12/08/2025

## STRENGTHENING INDIA'S GLOBAL TRADE POSITION

## 3879.    Thiru Arun Nehru:

Will  the  Minister  of COMMERCE  AND  INDUSTRY  ( वाणिज्य एवं उद्योग मंत्री ) be pleased to state:

- (a) the details of the India's exports and imports during the last five financial years along with the details of the trade surplus or deficit and the key factors contributing to this trend State and year-wise;
- (b) the details of the steps taken to integrate Indian MSMEs into global supply chains and support them through export financing, e-commerce and logistic reforms;
- (c) the  details  of  the  steps  taken  to  promote  rupee  trade  settlements  with  partner countries to strengthen India's trade autonomy and reduce dependency on hard currencies;
- (d) whether  the  Government  is  preparing  a  roadmap  to  reach  $2  trillion  in  exports  by 2030 and if so, the strategic sectors and policy instruments identified to achieve this target; and
- (e) whether  the  Government  is  considering  to  promote  green  trade  corridors,  carbon compliant  exports  and  digital  trade  facilitation  zones  to  along  with  global  sustainability standards, if so, the details thereof ?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्यमंत्री ( श्री णिणिन प्रसाद ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (SHRI JITIN PRASADA)

- (a) India's  merchandise  goods  and  services  trade  data  for  the  last  five  financial  years, including exports, imports, and resulting trade balance, is as follows:

Value (in Million USD)

|                | Merchandise Trade   | Merchandise Trade   | Services Trade   | Services Trade   | Overall Trade   |
|----------------|---------------------|---------------------|------------------|------------------|-----------------|
| Financial Year | Export              | Import              | Export           | Import           | Balance         |
| 2020-21        | 291,808.48          | 394,435.88          | 206,090.74       | 117,524.45       | (-)14,061.11    |
| 2021-22        | 422,004.40          | 613,052.05          | 254,527.71       | 147,011.98       | (-)83,531.92    |

| 2022-23   | 451,070.00   | 715,968.90   | 325,329.70   | 182,046.04   | (-)121,615.24   |
|-----------|--------------|--------------|--------------|--------------|-----------------|
| 2023-24   | 437,072.03   | 678,214.77   | 341,062.41   | 178,311.82   | (-)78,392.15    |
| 2024-25   | 437,511.75   | 721,320.48   | 387,540.49   | 198,716.66   | (-)94,984.90    |

Source: Merchandise data- DGCI&S, Services Data - RBI

India's trade deficit  from FY 2020-21 to 2024-25 is attributed to a range of structural and external  macroeconomic  factors.  A  significant  contributor  has  been  the  persistent  rise  in imports, particularly of crude oil, electronics, and key industrial inputs. This trend reflects the strong  domestic  consumption  demand  coupled  with  growing  domestic  manufacturing capacity  in  certain  sectors.  The  exports  have  also  grown  despite  global  challenges  & disruptions  including  the  Russia-Ukraine  conflict,  high  logistics  cost  due  to  conflict  in middle  east,  elevated  inflation  levels  across  major  economies,  rising  trend  of  protectionist measures globally and subdued demand in key markets such as Europe and China.

(b) To facilitate greater integration of Indian MSMEs into global value chains, enhance their  export  competitiveness,  and  support  their  financing  and  market  access  needs,  the Government  has  undertaken  several  initiatives  across  export  credit,  risk  mitigation,  digital enablement, and logistical facilitation:

- i. Enhanced cover of 90% for exporters / group with aggregate export credit working capital limit up to ₹80 Cr under its Short-term (ST) Whole Turnover -Export Credit Insurance for Banks (WT-ECIB) cover, to facilitate the availability of adequate and affordable export credit to exporters, particularly MSMEs.
- ii. 90% Insurance Cover for Collateral Free working capital export credit finance under its  Short  term  (ST)  WT-ECIB  cover,  for  working  capital  export  credit  limits sanctioned  up  to  ₹10  crore  in  respect  of  those  Micro  and  Small  exporter  accounts which are not in a position to offer any collaterals or third-party guarantee, and shall be applicable for all segments and commodities.
- iii. Enhanced  percentage  of  up  to  100%  cover  to  exporters  who  take  policy  directly without  involving  any  alternate  channels  or  brokers.  This  may  be  considered  as  a collateral  by  the  bank  for  export  credit  lending,  particularly  to  MSMEs,  who  avail policy  directly  without  the  involvement  of  alternate  channels  or  brokers,  thereby reducing collateral requirement for export credit sanctioned by banks.
- iv. In order to provide better service and improve the turnaround time for settlement of claims under Short Term ECIB, the procedure for settlement of ECIB Claims with net principal outstanding up to ₹10 crore for the exporter/group, has been simplified with reduced requirement of documents.
- v. Export Factoring Facility on non-recourse basis specifically designed for manufacturer MSMEs which provides a comprehensive package of financial services, including working capital financing, credit risk protection, sales ledger management, and the collection of export receivables, to support the MSME exporters by mitigating risks associated with exporting and facilitating access to finance, making it easier for MSMEs to participate in international trade.

- vi. Support to NBFC (Factors) through Exports Receivables Insurance Cover (ERIC) in Indian Rupees and in Foreign Currency (FC) to enable factoring companies to support exports to broader markets.
- vii. The Ministry of MSME  supports  MSME  exports  through schemes like the International Cooperation (IC) Scheme, including the Capacity Building of First-Time Exporters (CBFTE), offering reimbursement for export-related expenses.

(c) The  Reserve  Bank  of India  (RBI) has  allowed invoicing and payments  for international trade in Indian Rupee vide A.P (DIR Series) Circular No.10 RBI/2022-2023/90 dated 11.07.2022. In terms of the said RBI Circular, the framework has been put in place for any  partner  country  seeking  to  undertake  trade  with  India  in  INR.  Accordingly,  banks  of partner countries can approach Authorized Dealer (AD) banks in India who in turn can seek approval from RBI with details of the arrangement. Various approvals have been granted by RBI to domestic and foreign AD Banks in the cases for opening of Special Rupee Vostro Accounts (SRVAs) of correspondent banks.

Amendments  have  also  been  made  by  DGFT  in  the  Foreign  Trade  Policy  to  allow  for invoicing, payment, and settlement of exports/imports in Indian Rupees. Amendments have also been made in the Foreign Trade Policy for grant of exports benefits and fulfilment of Export  Obligation,  for  export  realisations  made  in  Indian  Rupees  as  per  the  said  RBI guidelines.

Additionally, a Local Currency Settlement (LCS) system has been signed in July 2023 with United Arab Emirates(UAE), to promote the use of the Indian Rupee (INR) and United Arab Emirates Dirham (AED) for cross-border transactions.

(d) While no target  has  been  set,  the  Government  is  taking  a  number  of  initiatives  for boosting India's merchandise and service exports. This vision is aimed at transforming India into a leading global hub for manufacturing, services, and trade. Several strategic interventions and sectoral enablers have been identified to advance this objective, as outlined below:

- Production  Linked  Incentive  (PLI)  Schemes  -  Implemented  across  14  strategic  sectors including  electronics,  IT  hardware,  pharmaceuticals,  medical  devices,  textiles,  food processing,  telecom,  auto  and  auto  components,  solar  PV  modules,  and  advanced chemistry  cells.  These  schemes  aim  to  enhance  domestic  manufacturing  capabilities, promote scale and competitiveness, and integrate Indian industry into global value chains.
- Foreign  Trade  Agreements  (FTAs)  -  India  has  adopted  a  calibrated  approach  to negotiating  FTAs  to  expand  market  access  while  protecting  domestic  interests.  Recent FTAs operationalised include the India-Mauritius Comprehensive Economic Cooperation and  Partnership  Agreement  (CECPA)  (2021),  India-UAE  Comprehensive  Economic Partnership  Agreement  (CEPA)  (2022)  and  the  India-Australia  Economic  Cooperation and Trade Agreement (ECTA) (2022). Further, two major trade  agreements have been recently  concluded:  the  India-United  Kingdom  Free  Trade  Agreement  and  the  India-

European  Free  Trade  Association  (EFTA)  Trade  &  Economic  Partnership  Agreement (TEPA). Ongoing negotiations include:

- India-EU Free Trade Agreement
- India-USA Bilateral Trade Agreement
- India-Peru Free Trade Agreement
- India-Chile Comprehensive Economic Partnership Agreement (CEPA)
- India-Oman CEPA
- India-New Zealand FTA
- Foreign  Trade  Policy(FTP)  2023    -  FTP  outlines  long-term  goals  to  support  exporters through digitisation, quality compliance, and trade facilitation. Key initiatives include:
- The proposed Export Promotion Mission(EPM) announced in the Union Budget 2025-26  is  under  inter-ministerial  consultation.  EPM  aims  to  address  MSME export  challenges  by  improving  cash  flows,  reducing  transaction  costs,  and expanding access to global markets.
- The Trade Connect ePlatform has been launched to provide comprehensive traderelated information to Indian exporters, particularly MSMEs. It acts as a unified digital hub connecting Indian Missions, Export Promotion Councils, Commodity Boards, and other trade bodies.
- The Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme has been operational since April 1, 2021. It covers 10,642 tariff lines with a budget allocation of ₹18,232.50 crore for FY 2025-26.
- The Rebate of State and Central Taxes and Levies (RoSCTL) Scheme, operational since March 2019, promotes exports from the labour-intensive textile and apparel sector by reimbursing embedded taxes and levies.
- E-Commerce Export Hubs (ECEHs) initiative, aims  to  provide  dedicated  zones for  facilitating  cross-border  e-commerce  exports  from  India.  The  objective  is  to support  SMEs,  artisans,  and  small  businesses  by  reducing  the  cost  and  time associated with logistics, streamlining regulatory processes, and simplifying  reimports  for  e-commerce  returns  or  rejects.  ECEHs  shall  provide  integrated services at a single location, encompassing customs clearance, quality certification, packaging, and off-port warehousing.
- Logistics  and  Infrastructure  Development  -  Implementation  of  the  PM  Gati  Shakti National  Master  Plan  and  the  National  Logistics  Policy  to  improve  supply  chain efficiency and reduce costs.

(e) Yes, the Government is taking multiple initiatives to promote green trade corridors, carbon-compliant exports, and digital trade facilitation zones in line with India's commitments under international frameworks such as the Paris Agreement and the United Nations Sustainable Development Goals (SDGs). The details are as follows:

- Efforts are underway to encourage the export of environment-friendly and sustainable products, including renewable energy components, electric vehicles, green hydrogen, eco-textiles, and organic goods. Initiatives also focus on promoting energy-efficient

and low-emission logistics infrastructure through programmes such as PM GatiShakti and the National Logistics Policy.

- Support is being extended to Indian exporters to meet international carbon standards through  capacity-building  programmes,  certification  support,  and  facilitation  by Export  Promotion  Councils.  Sustainable  and  low-emission  manufacturing  is  being encouraged  under  sectoral  policies,  including  Production  Linked  Incentive  (PLI) schemes.
- The  Government  is  advancing  digitalisation  of  trade  processes  through  paperless documentation,  single-window  systems,  and  integrated  logistics  platforms.  Key initiatives  include  the  Unified  Logistics  Interface  Platform  (ULIP),  integration  of Customs  systems  with  Partner  Government  Agencies,  and  implementation  of  the National  Trade  Facilitation  Action  Plan  (NTFAP  3.0)  2024-27,  which  emphasises paperless trade and faster border compliance.

These  measures  aim  to  ensure  that  India's  trade  ecosystem  remains  environmentally sustainable, digitally enabled, and globally competitive.

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