India's foreign trade vasanth kumar,c. palb3104 jr m.sc agril economics macro economics analysis

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India’s Foreign Trade

Submitted to,Dr.G.S.MahadevaiahAssociate Professor

Dept. of Agril Economics Presented by,Vasanth kumar,c

PALB 3104Jr.M.Sc Agril Economics

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Flow Of Presentation

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IntroductionCurrent status of Exports and ImportsNeed and importance.How Foreign Trade affects the Indian

marketsFeatures of Indian Foreign Trade Composition of Foreign tradeAdvantages and Limits of Foreign tradeForeign trade policyConclusion

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Introduction

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Introduction to India's Foreign Trade

Foreign trade is exchange of capital, goods, and services

across international borders or territories. In most countries, it

represents a significant share of gross domestic product (GDP).

Foreign Trade is one of the significant macro fundamental

variable of an economy. India was predominantly a primary goods

exporting and mainly an industrial goods importing country

In 1950s, India's share in the world trade was 1.78 per cent

which was decline to 0.59 per cent in 1990 and continues to remain

around 0.60 per cent. India's share in world exports was 0.8 per cent

in 2006

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Foreign trade transactions are classified under three categories:

Import Trade Export TradeNet Exports

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Foreign trade Includes:-

Involvement of different monitery units.Imposition of restrictions in import and

export by various countries.Imposition of restrictions on release of

foreign currencies existence of multiple regulations.

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Current status of India’s exports and imports

EXPORTS 

Exports during January, 2013 were valued at US $ 25587.08

million (Rs.138981.60 crore) which was 0.8 per cent higher in Dollar

terms (6.67 per cent higher in Rupee terms) than the level of US $

2379.77 million (Rs. 1305425.33 crore) during January, 2012.

Cumulative value of exports for the period April-January

2012 -13 was US $ 239687.01million (Rs 1305420.39) as against US

$ 251930.14 million (Rs 1196962.33 crore) registering a negative

growth of 4.86 per cent in Dollar terms and growth of 9.06 per cent in

Rupee terms over the same period last year

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Major Export Items(USD million)

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IMPORTS

Imports during January, 2013 were valued at US $ 45583.03 million

(Rs.247593.93 crore) representing a growth of 6.12 per cent in Dollar

terms and growth of12.28per cent in Rupee terms over the level of

imports valued at US $ 42955.87 million (Rs. 220514.09 crore) in

January, 2012.

Cumulative value of imports for the period April-January, 2012-13

was US $ 406855.13 million (Rs. 2215115.46 crore) as against US $

406820.28 million (Rs. 1934946.96 crore) registering a positive

growth of 0.01 per cent in Dollar terms and growth of 14.48 per cent

in Rupee terms over the same period last year

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Major Import Items (USD million)

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Deemed Exports” refer to those transactions in which goods supplied do not leave country, and payment for such supplies is received either in Indian rupees or in free foreign exchange

Deemed Exports

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How Foreign Trade Affects The Indian Markets?

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Foreign trade affects the domestic trade and markets of a country and India.

India is a part of the globalization and any effect, positive or negative, on the global trade is bound to affect the Indian markets.

It was until 1991 that India followed a socialist-democratic approach which kept it uncommitted to the foreign countries.

India, like other countries participating in globalization, has been exporting and importing products and services to and from other countries.

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Reason for the Rise of Foreign Trade 

Large Scale Production

Degree of Self-Sufficiency

Geographic Factors

Occupational Distribution

Means of Transportation

Compensating the Production

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Composition of India's Foreign trade

Composition of foreign trade means major commodity or sectors in

which India is doing export and import

India is a very old participant in world trade

Its participation have been promoted by the opening of Suez Canal

and speedy development of the ship building industry supplemented

by the spread of industrial revolution in Europe and fast expansion

of Indian railways

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Composition of India’s exportsFuel and lubricants

Agricultural &allied products

Manufactured items

Ores and Minerals

Composition of Exports

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Composition of India's Imports

In 1947-48 the main items of India's imports were

machineries, oil, grains, cotton, cutlery, hardware implements,

chemicals, etc. They constituted 70 per cent of India's imports.

After that due to the emphasis on industrialization during the

second 5-Year plan necessitated the imports of capital goods.

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Composition of India’s ImportsOthers

Petroleum products

Capital goods

Composition of Imports

26Source :Economic survey 2011-12

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Union Commerce Ministry, GoI announces

integrated FTP every five year also called

EXIM policy.

policy updated every year with some

modifications & new schemes.

FTP which was announced on August 28,

2009 is an integrated policy for the period

2009-14.

What is Foreign Trade Policy?

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Foreign Trade Policy 2009-14

Short Term Objectives:arrest and reverse the declining trend of exports. provide support to those sectors which have been hit

badly by recession.

Medium term Policy Objectives :achieve an Annual Export growth of 15% by March

2013. achieve Annual Export growth of around 25% by 2014.

Long Term Objective :doubling India’s share in Global Trade by 2020.

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Composition of India’s Foreign Trade has undergone a positive change.

It is a remarkable achievement that India has transformed itself from a predominantly primary goods exporting country into non primary goods exporting country.

Under Imports also India’s dependence on food grains and capital goods has declined.

India needs to try diversifying its exports.

conclusion

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