Despite global challenges, India’s exports grew to $602.6B in FY25. A new trade strategy is needed for competitiveness
Chennai: Trade sector has demonstrated stability and growth despite global economic headwinds. However, rising trade protectionism and increased uncertainty calls for a new strategic trade roadmap, which includes enhancing participation in global supply chains, reduction in trade costs and improvement in facilitation to boost export competitiveness.
India's overall exports have shown positive momentum in the first nine months of FY25, reaching $602.6 billion. This increase demonstrates the resilience of exports.
India’s current account deficit (CAD) moderated slightly to 1.2 per cent of GDP in Q2 of FY25 against 1.3 per cent of the GDP recorded in Q2 of FY24. The recent rise in the CAD can be attributed to an increase in the merchandise trade deficit. However, the rising net services receipts and increase in private transfer receipts cushioned the expansion in the merchandise trade deficit.
Even though gross FDI inflows to India have increased in the first eight months of FY25, there has been a rise in repatriations as international companies realised returns from investments. FPI inflows have shown volatility in the first nine months of FY25.
India needs a new strategic trade roadmap. To remain competitive and enhance its participation in global supply chains, India must continue reducing trade costs and improving facilitation to boost export competitiveness.
The state takes care of governance, and the private sector produces goods and services. If both these entities focus on quality and efficiency, then despite the trade tensions and protectionism, India can increase its share in overseas markets and generate resources to sustain a higher level of capital formation and better economic growth.
