New trade policy to set ambitious $2tn export target for India
Commerce secretary Sunil Barthwal on Wednesday said the government is expected to release the FTP by the end of this financial year, which will have a five-year roadmap to enhance the country’s trade
$2 trillion by 2030 — that may be the new exports target defined by India in its new Foreign Trade Policy (FTP), which will be released later this month, two officials said, asking not to be named.
With exports this year estimated to be at least $750 billion, that requires a growth rate of 15%. This year, India’s exports are expected to grow by at least 12%.
Commerce secretary Sunil Barthwal on Wednesday said the government is expected to release the FTP by the end of this financial year, which will have a five-year roadmap to enhance the country’s trade.
After extension, the current FTP (2015-20) will expire on March 31, 2023. On September last year, the government extended the existing FTP for six months due to adverse global economic conditions. FTP, which provides guidelines for enhancing exports, driving economic growth and creating jobs, was first extended on March 31, 2020 for one year due to the outbreak of the Covid-19 pandemic.
One of the officials said the $2 trillion exports will have equal share of goods and services. The focus of the new policy is expected to be on trade promotion through Free Trade Agreements (FTAs), import substitution, import diversification, marketing via Indian missions, nudging every sector through respective ministries and involving states in promotion of exports.
“The $2 trillion target by 2030 is achievable. Of course, there are global headwinds and situation is not very conducive , but India has certain advantages that it can leverage to its advantage,” said Ajay Sahai, director general and chief executive of the Federation of Indian Export Organisations (FIEO).
He added that free trade agreements, the ₹20-lakh crore production-linked incentive (PLI) schemes, inclination of major economies such as the US to rely on India for friendshoring, diversion of Russian supplies from Europe to India and European supplies from Russia to India are favourable for the country.
“FTP should have two-pronged strategy – encouraging sunrise sectors (such as electronics, pharmaceuticals, automobiles) and incentiviseing labour-intensive sectors such as textiles and leather. Services exports are doing exceedingly well. There is a need to also focus beyond IT and ITES. India has immense potential in travel and tourism, health and medical, audit and accounts, films and other professional services.”