Topic– Indian economy: issues
4) Examine with the help of data, whether we are on track to achieve export targets as envisaged in FTP? Discuss the contribution of different sectors of economy to exports of India and highlight the areas of improvement?(250 words)
Why this question
The article provides truckloads of data which can be utilized to embellish your answers of GS3. Moreover, it also touches upon a key issue which is the performance of exports. At a time, when India is facing a lot of macroeconomic issues, it is imperative to focus on exports which the FTP envisaged would be a key driver of India’s economic growth. Hence this question needs to be prepared.
Key demand of the question
The question expects us to bring out the targets envisaged under FTP 2015-20, examine how far have we succeed in achieving those targets. Next, we need to bring out the performance of various sectors of exports in India and analyze, which sector would be most useful in boosting exports.
Examine – When you are asked to examine, you have to probe deeper into the topic, get into details, and find out the causes or implications if any .
Discuss – Here in your discussion, you need to debate the pros and cons of various sectors and sub-sectors of economy and bring out which sector would be most productive for boosting our exports and improving our BoP.
Structure of the answer
Introduction – Explain that India’s performance in exports has deceived expectations after a couple of years of good performance. At a time when fuel prices are seeing an exponential rise, exports needs to keep up.
- Explain that FTP targeted a 3.5% share in world exports and a figure of 900bn$. Against that target, India registered just 10% growth in 2017-18, to $302.8 billion, against expectations of $325 billion, and also a 45% jump in trade deficit at $157 billion, the highest in last five years. As RBI data reveals, the country’s merchandise exports, having peaked at 17% of GDP in 2013-14, dropped to around 12% in 2016-17. India has underperformed even amidst robust global trade growth.
- Highlight the reasons why Indian exports is not picking up
- Discuss the various sectors which are major contributors to world exports such as energy and resource-intensive goods such as fuels and mining products, iron and steel, paper, etc, aggregating about 30% of total global exports; sunrise industrial goods largely in the electronics and telecom sectors, accounting for 25% ;automotive products, machinery, chemicals, pharmaceuticals, etc, another 25%; agricultural products, 10%; (5) labour-intensive tradeables such as textiles, clothing, leather goods, and miscellaneous manufactures, another 10%. Examine how India’s performance is in these sectors and the scope of improvement
Conclusion – Give your view on what you think should be the focus area of Indian exports so as to keep BOP in check.