One of the most important phenomena in post-war economic history has been the enormous expansion of world trade. Indian trade grew poorly from 1950 to 1980 as compared with the world. However, from 1980 onwards, Indian exports have been rising at one and a half times the pace of growth in world exports. In 1993, India ranked 33rd in top exporting countries and 32nd in top importing countries.
India's Foreign Trade
(value : Rupees million)
Year Exports Variation(%) Imports Variation(%) Balance of Trade ________________________________________________________________________________ 1990-91 325,530 + 17.6 431,930 + 22.0 -106,440 1991-92 440,420 + 35.3 478,510 + 10.7 - 38,090 1992-93 533,510 + 21.1 629,230 + 31.5 - 95,720 1993-94 695,470 + 30.3 728,060 + 15.7 - 32,590 1994-95 823,380 + 18.4 887,050 + 21.8 - 6,210 _________________________________________________________________________________
( value : Rupees million)
Country Export from India % of India's total (value) exports ________________________________________________________________ U.S.A. 157,478 mill. 19.12 % Japan 63,749 mill. 7.74 % Germany 54,526 mill. 6.62 % U.K. 53,005 mill. 6.43 % Hong Kong 47,608 mill. 5.78 % UAE 39,319 mill. 4.77 % Italy 26,906 mill. 3.27 % ________________________________________________________________
Top Seven Countries for Indian Imports in 1994-95
( value : Rupees million)
Country Indian Imports (value) % of India's total imports _____________________________________________________________ U.S.A. 89,302 mill. 10.06 % Germany 67,313 mill. 7.58 % Japan 62,882 mill. 7.08 % Saudi Arab 49,388 mill. 5.56 % U.K. 48,365 mill. 5.45 % UAE 48,238 mill. 5.43 % Kuwait 46,383 mill. 5.22 % _____________________________________________________________
Foreign Collaboration Policies
India's effort to accelerate industrialisation & improve international competitiveness received a boost with the announcement of the New Industrial Policy in July 1991. A key element of the Industrial Policy & an important component of the reform program is the freah approach towards foreign investment & technological tie-ups. The Policy changes were designed to attract significant & sustained capital inflows into India, while encouraging technological collaboration between Indian & foreign companies.
Foreign Investment Policies
Indian Joint Ventures Abroad
Indian joint ventures (Jvs) & wholly owned subsidiaries are an important instrument for promoting exports, trade expansion & economic cooperation. India's foreign investment is the highest amongst 3rd world countries & is dispersed over 70 countries. As on 31st Decemeber 1994, there were 524 joint ventures, of which 177 were in operation & 347 at different stages of implementation. The Indian equity in the 177 Jvs was Rs 1,817 million in Dec 1994 & the approved Indian equity in the 347 Jvs was Rs 13,952 million.
Impact of New Policy and Future Direction
The focus of the government in 1994-95 continued to be on creating a free environment for trade, streamlining & simplification of procedures, increasing export production, sharpening competitive edges & focussing on quality & technological upgradation. During the year several measures were taken for export promotion, aimed at consolidating the growth of 18.3% achieved in (US) dollar terms in 1994-95. Some of the measures taken are :-
However, India still has a long way to go - it's share in world exports was a mere 0.65% in 1994-95. India imported Rs.887 billion of goods in 1994-95, and exported Rs.823 billion.