The integration of domestic economy through the twin channels of trade and capital flows has seen acceleration over the last two decades as India’s GDP reached Rs 190.10 trillion (US$ 2.72 trillion) in 2018-19*. Simultaneously, the per capita income also nearly trebled during these years. India’s trade and external sector had a significant impact on the GDP growth as well as expansion in per capita income. India’s GDP at current prices in 2019-20 was estimated to reach Rs 203.85 lakh crore (US$ 2.91 trillion).
Total export from India (Merchandise and Services) stood at US$ 528.45 billion in 2019-20, while total import was estimated at US$ 598.61 billion according to data from the Ministry of Commerce & Industry.
The merchandise export stood at US$ 314.31 billion in 2019-20, while that for import touched US$ 467.19 billion in the same period.
The estimated value of services export and import for 2019-20 stood at US$ 214.14 billion and US$ 131.41 billion, respectively.
According to Mr Piyush Goyal, Minister for Commerce and Industry, the government of India is keen to grow export and provide more jobs for young, talented and well-educated people as well as for semi-skilled and unskilled workforce in India.
India's foreign exchange reserves was Rs 28.74 lakh crore (US$ 414.14 billion) in the week up to April 19, 2020 according to the data from the RBI.
- In February 2020, memorandum of understanding (MoU) was signed between the Department of Health and Family Welfare, Government of India and Department of Health and Human Services, Government of the United States of America.
- In February 2020, President of Portugal, H.E. Mr Marcelo Rebelo de Sousa, Minister of National Defense of Portugal and India’s Minister of State for Shipping(I/C) and Chemical and Fertilizer, Mr Mansukh Mandaviya signed a MoU to develop a world class National Maritime Heritage Complex at Lothal, Gujarat with cooperation from the Republic of Portugal.
- In February 2020, cabinet approved the MoU signed between India and Iceland in the field of Sustainable Fisheries Development.
- In January 2020, MoU was signed between India and Finland to improve defence cooperation between Finnish companies and Indian Defence Public Sector Undertakings.
- In January 2020, India signed a MoU with the Department for International Development (DFID), Government of United Kingdom to facilitate the energy self-sufficiency of the Indian Railways.
- In December 2019, cabinet approved the MoU between Central Electricity Authority, India and Japan Coal Energy Centre, on the two countries cooperation for Efficiency and Environmental Improvement for Sustainable, Stable and Low-Carbon supply of Electricity.
- The memorandum of cooperation (MoC) between Government of India and Government of Japan in order to constitute ‘India-Japan Steel Dialogue’ to strengthen cooperation in steel sector got approval from the cabinet in December 2019.
- In November 2019, All India Institute of Ayurveda (AIIA) signed a MoU with Western Sydney University, Australia in New Delhi.
- In November 2019, the MoU signed between India and Finland was approved by the cabinet in order to strengthen the cooperation in the field of Tourism.
- In October 2019, a MoU was signed between Central Drugs Standard Control Organization (CDSCO) and Saudi Food and Drug Authority in the field of Medical Products Regulation.
- In September 20W19, four MoUs were signed between India and Mongolia to focus on cultural exchange protocol, disaster management, space exploration and animal health and dairy.
- In September 2019, Liquefied Natural Gas (LNG) importer Petronet entered into an agreement with US LNG developer Tellurian Inc. to invest US$ 2.5 billion.
- In August 2019, four MoUs were signed between India and France to focus on skill development and vocational training, renewable energy, IT services and space research.
Foreign Trade Policy
- In the mid-term review of Foreign Trade Policy (FTP) 2015-20, the Ministry of Commerce and Industry enhanced the scope of Merchandise Exports from India Scheme (MEIS) and Service Exports from India Scheme (SEIS), increased MEIS incentive raised for ready-made garments and made-ups by 2 per cent and raised SEIS incentive by 2 per cent and increased the validity of Duty Credit Scrips from 18 months to 24 months. In April 2020, government extended FTP for one more year, up to March 31, 2021.
- In August 2019, the Ministry of Commerce planned to introduce new FTP aimed at providing incentives and guidelines for increasing export in the next five financial years, starting FY20.
India is presently known as one of the most important players in the global economic landscape. Its trade policies, government reforms and inherent economic strengths has attributed to its standing as one of the most sought-after destination for foreign investments in the world. Also, technological and infrastructural development being carried out across the country augurs well for the trade and economic sector in the years to come.
The government of India has been working on striking important deals with the Governments of Japan, Australia and China to increase contribution towards the economic development of the country and growth in the global market.
India has the potential to increase its goods and services export to Australia to US$ 15 billion by 2025 and US$ 35 billion by 2035.
*Provisional estimates at current prices
Note: Conversion rate used in April 2020, Rs 1 = US$ 0.013123