FOREIGN TRADE IN INDIA
Overview
- In 1950, India’s share in total world trade was 1.78 %. By 2002 this had dropped to 0.8 %
- India has a total foreign trade of around USD 489 billion. Of this imports accounted for USD 303 billion and exports USD 185 billion
- Based on 2008-2009 data, India’s largest trading partner is the UAE (total trade USD 48 billion)
- India exports the maximum to UAE (USD 24 billion) and imports the most from the People’s Republic of China (USD 32 billion)
- Foreign trade in India falls under the purview of the Department of Commerce under the Ministry of Commerce and Industry
Top trading partners
| Rank | Country | Exports
(USD billion)
| Imports
(USD billion)
| Total trade
(USD billion)
|
| 1 | UAE | 24.4 | 23.8 | 48.2 |
| 2 | PRC | 9.3 | 32.4 | 41.8 |
| 3 | USA | 21.1 | 18.5 | 39.7 |
| 4 | Saudi Arabia | 5.1 | 19.9 | 25.0 |
| 5 | Germany | 6.3 | 12.0 | 18.3 |
Special Economic Zones (SEZ)
- India was one of the first countries in Asia to recognize the effectiveness of Export Processing Zones (EPZ)
- The first Export Processing Zone (EPZ) in Asia was established in Kandla (Gujarat) in 1965
- The Special Economic Zone (SEZ) Policy was announced in 2000
- The main objectives of SEZs are
- Generation of additional economic activity
- Promotion of goods and services
- Promotion of investment from domestic and foreign sources
- Creating of employment opportunities
- Development of infrastructure facilities
- SEZs function under the Department of Commerce (Ministry of Commerce and Industry)
| S. No. | SEZ | Location | Type |
| 1 | Kandla SEZ | Gujarat | Multi product |
| 2 | SEEPZ | Mumbai | Electronics, gems and jewellery |
| 3 | Noida SEZ | Uttar Pradesh | Multi product |
| 4 | MEPZ | Chennai | Multi product |
| 5 | Cochin SEZ | Kerala | Multi product |
| 6 | Falta SEZ | West Bengal | Multi product |
| 7 | Visakhapatnam SEZ | Andhra Pradesh | Multi product |
Trade Agreements
| Agreement | Contracting parties | Notes |
| Agreement of Cooperation with
Nepal to control unauthorised trade
| India, Nepal | Established in 2009
The agreement aims to restrict and prevent unlawful activities
relating to traffic in narcotics, foreign exchange etc
|
| Agreement on South Asia Free Trade Area (SAFTA) | India, Pakistan, Sri Lanka,
Nepal, Bhutan, Bangladesh,
Maldives
| Established in 2007
Afghanistan, which became SAARC member in 2007, is set to become latest SAFTA member
India, Pakistan, Sri Lanka are categorised Non-Least Developed Contracting States (NLDCS)
Bhutan, Bangladesh, Nepal, Maldives are Least Developed Contracting States (LDCS)
NDLCS to reduce tariffs for LDCS products to 0-5 % in 3 years from contract
|
| Asia Pacific Trade Agreement (APTA) | Bangladesh, China,
India, South Korea, Sri Lanka
| Established 2005 |
| Comprehensive Economic Cooperation Agreement
between the Republic of India and the Republic of
Singapore
| India, Singapore | |
| India Chile Preferential Trade Agreement (PTA) | India, Chile | Signed 2005
India offers tariff preference of 10-50 % on 178 tariff lines (including meat, fish, salt, iodine,
Copper, chemicals, leather, newsprint, paper, wool, wood etc)
Chile offers preference of 10-100 % on 296 tariff lines (includes agricultural products, chemicals,
pharmaceuticals, dyes and resins, plastic, rubber, leather, textiles, footwear, industrial products)
|
| India Afghanistan PTA | India, Afghanistan | Afghanistan grants preferential tariff to 8 products from India including black tea, ayurvedic and
Homeopathic medicine, other medicine, sugar, cement
India grants preferential tariff to 38 products from Afghanistan, mainly agricultural products like
dry fruits
|
| India Bhutan Trade Agreement | India, Bhutan | |
| India Korea CEPA | India, South Korea | |
| India MERCOSUR PTA | India, MERCOSUR | MERCOSUR is a trading bloc in Latin America that comprises Brazil, Argentina, Uruguay and Paraguay
MERCOSUR offers tariff concession on 452 products
India offers tariff concession on 450 products
The major products covered in Indian offer list are meat products, chemicals, dyes and pigments,
raw hides and skins, leather, wool, cotton, glass, iron and steel, machinery, optical and photographic
equipment
The major products in MERCOSUR offer list include food, organic chemicals, pharmaceuticals, essential oils,
plastics, rubber, tools and implements, machinery
|
| India Sri Lanka FTA | India, Sri Lanka |
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