March 27, 2002
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INDIA’S TRADE WITH SAARC UP BY 37%
USA REMAINS INDIA’S LARGEST TRADING PARTNER AND EU INDIA’S LARGEST TRADING BLOC
ANNUAL REPORT OF DEPARTMENT OF COMMERCE 2001-02
India’s total trade with the SAARC member countries increased by over 37.4% during the year 2000-2001. While India’s exports to these countries registered an increase of 43.8%, imports from these countries also went up by 15.39%. This is indicated in the Annual Report of the Department of Commerce (Ministry of Commerce & Industry) for the year 2001-2002, which was released here today. The Report also states that USA remains India’s largest trading partner and plays a dominant role in India’s trade. During 2000-2001, the US accounted for 22.70% of India’s exports and 7.69% of India’s imports. The European Union (EU) is India’s largest trading bloc partner, accounting for about 22% of India’s global trade. India’s exports to West Asia and North Africa also showed an appreciable increase of 22.93% during 2000-2001. Referring to the activity-based integrated programme for the Latin American region ("Focus: LAC"), launched in November 1997 and extended upto March 2003, the Report says that the progress under this programme is reflected in an impressive growth of 50.47% in India’s exports to this region. India’s exports to the ASEAN countries witnessed a marginal growth, while a number of steps were taken to boost the level of trade with the erstwhile Rupee payment area countries, which had shown a significant decline following the disintegration of COMECON countries.
Export promotion continued to form a vital ingredient of trade policy during 2001-2002 and important policy changes were effected for creating an export-friendly environment, doing away with restrictive procedures, moving away from quantitative restrictions and improving competitiveness while meeting global standards and requirements. A Medium Term Export Strategy 2002-07 was announced on 30th January, 2002 with a view to providing a road map for the export sector in the medium term. A total of 220 items and 25 markets have been identified for special attention based on different criteria and for the identified potential export items, indicative sector-wise strategies have been formulated. The Exim Policy 2001-2002 announced on 31/03/2001 also contained a number of policy initiatives to boost exports, which included establishment of Agricultural Export Zones; setting up of Special Economic Zones (SEZs), where duty-free import/procurement of goods for factories in the Zone would be permitted; and formulation of a plan scheme entitled Market Access Initiative (MAI) to assist the industry in research & development, market research, specific market and product studies, warehousing and retail marketing infrastructure in select countries and direct market promotion activities through media advertising and buyer-seller meets, the Report says.
India’s export performance during 2001-2002, according to the Report, was affected by global recession and the events of September 11, 2001. During April to September of the financial year 2001-2002, the principal commodities which registered significant increase in exports over the corresponding period of the previous year included coffee, cereals, manufactured tobacco, sesame and niger seed, shellac, sugar and molasses, processed food, floriculture products, spirits and beverages, marine products, coal, leather manufactures, sports goods, chemical and allied products, electronic goods, coir and coir manufactures, silk carpet, petroleum products and other unclassified products. Commodities registering a fall in exports included tea, rice, pulses, tobacco, cashew including CNSL, groundnut, oil meals, guargum meals, castor oil, meat and preparations, ores and minerals except coal, gems and jewellery, project goods, ready made garments, cotton yarn, fabrics made-ups etc., wool and woollen manufactures, jute manufactures, handicrafts, carpets except silk carpets and cotton raw including waste, the Report adds.
Referring to multilateral initiatives and India’s participation in the Fourth Ministerial Conference of the World Trade Organisation (WTO) held in Doha (Qatar) from 9-14 November, 2001, the Report states: "As a responsible member of the WTO, India has always been supportive of the basic principles of free trade, while keeping the national interest in mind. During the Fourth (Doha) Ministerial Conference, India and other like-minded developing countries highlighted the various implementation concerns arising from the Uruguay Round Agreements. It is noteworthy that some of these implementation concerns were resolved at Doha and the Doha Declaration attached utmost importance to finding solutions to other outstanding issues as well. The Ministerial Declaration on TRIPs and Public Health addressed India’s concern in as much as it recognised that the TRIPs Agreement can and should be interpreted and implemented in a manner supportive of the members’ right to protect public health and to promote access to medicines for all. The Conference also agreed that special and differential treatment for developing countries shall effectively take account of their development including food security and rural development. These negotiations are expected to result in greater market access for agricultural products of countries like India, while retaining necessary flexibility. The Ministerial Declaration adopted at Doha recognises the work undertaken in the ongoing negotiations on agriculture and commits members to comprehensive negotiations which include substantial improvement in market access; reductions with a view to phasing out all forms of export subsidies; and substantial reductions in trade distorting domestic support. The Doha Declaration clearly envisages that special and differential treatment for developing countries is an integral part of all elements of negotiations. The modalities for further commitments in the three areas of market access, export subsidies and domestic support, as well as special & differential treatment provisions, are to be finalised by 31st March, 2003".