Discuss the major trends India's foreign trade. Also list the major products that India trade with other countries.
Discuss the major trends India's foreign trade. Also list the major products that India trade with other countries.
Foreign trade primarily involves the export of goods from countries and the import of goods by countries. In India, import and export of goods form an essential part of the overall economic activities. This can be seen in the increase of foreign trade in India’s GDP from 14.6 per cent in 1990-91 to 24.1 percent in 2003-04. Exports and imports have been increasing continuously since then.
The following table shows the major trends in India’s foreign trade.
India’s Exports and Imports: 2004-05 to 2011-12 (in crores of rupees)
Year
Exports
Imports
Trade balance
2004-05
375340
501065
-125725
2005-06
456418
660409
-203991
2006-07
571779
840506
-268727
2007-08
655864
1012312
-356448
2008-09
840755
1374436
-533681
2009-10
845534
1363736
-518202
2010-2011
1142649
1683467
-540818
2011-12 (P)
1024707
1651240
-626533
Source: NCERT Page-270, Table 11.2
From the table, the following facts can be derived.
(a) Since 2004-05, there has been a continuous rise in the values of both exports and imports. As we can see, the total value of exports was Rs. 3,75,340 crore in 2004-05. However, the value increased to Rs. 11,42,649 crore in 2010-11. Similarly, the value of imports increased from Rs. 5,01,065 crore in 2004-05 to Rs. 16,83,467 crore in 2010-11. Thus, from the table, we can infer that the country has registered an impressive growth in foreign trade since 2004.
(b) Despite the tremendous increase in both exports and imports, a trend of increasing negative trade balance was seen during the same period. This negative trade balance depicts the excess of imports over exports. As we can see, the trade balance was negative in all the years mentioned and was continuously rising negatively. We can, thus, infer two important facts.
(i) The value of imports was always more than that of exports.
(ii) The rate of increase in imports was always higher than the rate of increase in exports.
However, it can be concluded that both imports and exports have experienced a phenomenal growth during the last few years. The total value of exports has been lower than the total value of imports (as inferred from the negative trade balance in the last seven years).
To analyse the major components in India’s trading, we can study the following table.
Commodity Composition of India’s Exports
Product
Percentage share
2002-03
2003-04
Agricultural and allied
10.0
9.9
Ores and minerals
4.9
4.0
Manufactured goods
67.4
68.0
Textiles
8.1
6.7
Gems and jewellery
16.3
14.7
Engineering goods
10.9
12.1
Chemicals and related products
6.3
5.5
Leather and manufacturers
1.2
0.9
Petroleum, crude and related products
16.2
16.8
Others
1.5
1.2
Total exports
100.0
100.0
Source: NCERT page-271, Table 11.3
The following conclusions can be drawn from the table above.
(a) India mainly exported products such as manufactured goods; petroleum, crude and related products; gems and jewellery; and engineering goods. In other words, India was primarily engaged in the export of finished goods.
(b) Manufactured goods were a major component of Indian exports as they made up 68 per cent of the total exports. The share of gems and jewellery and petroleum products in the total exports was also significant.
Commodity Composition of India’s Imports
Product
Percentage share
2009-10
2010-11
Petroleum, oil and lubricants (POL)
30.1
28.6
Pearl, precious and semi-precious stones
5.6
9.4
Capital goods
15.0
13.1
Electronic goods
7.3
7.2
Gold and silver
10.3
11.5
Chemicals
5.2
5.2
Edible oils
1.9
1.8
Coal
3.1
2.7
Iron and steel
2.9
2.8
Professional instruments
1.3
1.1
Others
17.3
16.6
Total imports
100.0
100.0
Source: NCERT Page-271, Table 11.4
The following conclusions can be drawn from the table above.
(a) India mainly imported petroleum, oil and lubricants, capital goods, gold and silver, etc. In other words, India was primarily engaged in importing raw materials.
(b) Petroleum products were a major component of Indian imports as they made up 28.6 per cent of the total imports. The share of capital goods and gold and silver was also significant.
Foreign trade primarily involves the export of goods from countries and the import of goods by countries. In India, import and export of goods form an essential part of the overall economic activities. This can be seen in the increase of foreign trade in India’s GDP from 14.6 per cent in 1990-91 to 24.1 percent in 2003-04. Exports and imports have been increasing continuously since then.
The following table shows the major trends in India’s foreign trade.
India’s Exports and Imports: 2004-05 to 2011-12 (in crores of rupees)
|
Year |
Exports |
Imports |
Trade balance |
|
2004-05 |
375340 |
501065 |
-125725 |
|
2005-06 |
456418 |
660409 |
-203991 |
|
2006-07 |
571779 |
840506 |
-268727 |
|
2007-08 |
655864 |
1012312 |
-356448 |
|
2008-09 |
840755 |
1374436 |
-533681 |
|
2009-10 |
845534 |
1363736 |
-518202 |
|
2010-2011 |
1142649 |
1683467 |
-540818 |
|
2011-12 (P) |
1024707 |
1651240 |
-626533 |
Source: NCERT Page-270, Table 11.2
From the table, the following facts can be derived.
(a) Since 2004-05, there has been a continuous rise in the values of both exports and imports. As we can see, the total value of exports was Rs. 3,75,340 crore in 2004-05. However, the value increased to Rs. 11,42,649 crore in 2010-11. Similarly, the value of imports increased from Rs. 5,01,065 crore in 2004-05 to Rs. 16,83,467 crore in 2010-11. Thus, from the table, we can infer that the country has registered an impressive growth in foreign trade since 2004.
(b) Despite the tremendous increase in both exports and imports, a trend of increasing negative trade balance was seen during the same period. This negative trade balance depicts the excess of imports over exports. As we can see, the trade balance was negative in all the years mentioned and was continuously rising negatively. We can, thus, infer two important facts.
(i) The value of imports was always more than that of exports.
(ii) The rate of increase in imports was always higher than the rate of increase in exports.
However, it can be concluded that both imports and exports have experienced a phenomenal growth during the last few years. The total value of exports has been lower than the total value of imports (as inferred from the negative trade balance in the last seven years).
To analyse the major components in India’s trading, we can study the following table.
Commodity Composition of India’s Exports
|
Product |
Percentage share |
|
|
2002-03 |
2003-04 |
|
|
Agricultural and allied |
10.0 |
9.9 |
|
Ores and minerals |
4.9 |
4.0 |
|
Manufactured goods |
67.4 |
68.0 |
|
Textiles |
8.1 |
6.7 |
|
Gems and jewellery |
16.3 |
14.7 |
|
Engineering goods |
10.9 |
12.1 |
|
Chemicals and related products |
6.3 |
5.5 |
|
Leather and manufacturers |
1.2 |
0.9 |
|
Petroleum, crude and related products |
16.2 |
16.8 |
|
Others |
1.5 |
1.2 |
|
Total exports |
100.0 |
100.0 |
Source: NCERT page-271, Table 11.3
The following conclusions can be drawn from the table above.
(a) India mainly exported products such as manufactured goods; petroleum, crude and related products; gems and jewellery; and engineering goods. In other words, India was primarily engaged in the export of finished goods.
(b) Manufactured goods were a major component of Indian exports as they made up 68 per cent of the total exports. The share of gems and jewellery and petroleum products in the total exports was also significant.
Commodity Composition of India’s Imports
|
Product |
Percentage share |
|
|
2009-10 |
2010-11 |
|
|
Petroleum, oil and lubricants (POL) |
30.1 |
28.6 |
|
Pearl, precious and semi-precious stones |
5.6 |
9.4 |
|
Capital goods |
15.0 |
13.1 |
|
Electronic goods |
7.3 |
7.2 |
|
Gold and silver |
10.3 |
11.5 |
|
Chemicals |
5.2 |
5.2 |
|
Edible oils |
1.9 |
1.8 |
|
Coal |
3.1 |
2.7 |
|
Iron and steel |
2.9 |
2.8 |
|
Professional instruments |
1.3 |
1.1 |
|
Others |
17.3 |
16.6 |
|
Total imports |
100.0 |
100.0 |
Source: NCERT Page-271, Table 11.4
The following conclusions can be drawn from the table above.
(a) India mainly imported petroleum, oil and lubricants, capital goods, gold and silver, etc. In other words, India was primarily engaged in importing raw materials.
(b) Petroleum products were a major component of Indian imports as they made up 28.6 per cent of the total imports. The share of capital goods and gold and silver was also significant.
