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INDEX

INTRODUCTION………………………………………...……………………1

EXPORT CHALLENGE…….………………………..………………………3

TRADITIONAL EXPORTS……………………………………….………….4

STRATEGIES FOR EXPORT…………………………………………........5

INDIA’s EXPORT PERFORMANCE…………………………………........6

MODELS OF EXPORT DEMAND & SUPPLY……….……………….......7

LIST OF COUNTRIES BY EXPORTS…………….………………………..8

ROLE OF EXPORTS………………………………………………………..10

FEDERATION OF INDIAN EXPORT ORGANISATION…....................11

EXPORT POTENTIAL OF INDIA IN LIVESTOCK SECTOR……..

……………………………………………………………….13

EXPORT PERFORMANCE OF MANUFACTURED

PRODUCTS………………………………………………………………….14

EXPORT QUOTAS & POLICY CONSTRAINTS………….…………......16

INDIA’s EXPORT-IMPORT GROWTH BETTER v/s ASIAN

COUNTRIES………………………….………………………………….......17

OVERALL VIEW….................................................................................19

INDIA’s EXPORT SECTOR GOING FOR ASLOWDOWN…………………………………………………..………........21

THE GROWTH OUTLOOK..…………………………………………........22

CONCLUSION……………………….………………………………….......23

BIBLIOGRAPHY....................................................................................24

CASE STUDY........................................................................................25

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INTRODUCTION:

 India's exports have grown much faster than GDP over the past few

decades. For example, its exports have grown over 11% per annumwhile growth in GDP is about 5% during 1970-98 periods. Exports

have grown even faster since 1945-95. Several factors appear to have

contributed to this phenomenon including foreign direct investment 

(FDI) which has been rising consistently especially from the early

1990s. By 1997 India became the ninth largest recipient of such

investment among the developing economies (World Bank, 1998:20).

 However, despite increasing inflows of FDI there has not been anyattempt to assess its contribution to India's export performance one of 

the channels through which FDI affects growth.

Indian Export Scene — thechallenge of exporting:

 Exporting is the key to a vibrant economy, but there are quite a fewbarriers, both tariff and otherwise. India must leverage its inherent advantage of transparency and reliability to foray successfully into

 foreign markets.

 In today's globalised and competitive world, the external sector of acountry's economy assumes critical importance. In an effort toacquire a fair share of world trade, countries are adopting newer 

  policies and strategies to promote exports. For such emerging markets as India exports are recognised as the prime mover of economic growth.

 Need to export?

The first reason for India to export is to earn revenues. Second, is thenotion of prestige attached to it. India is fast emerging as a global economic power and its established export credibility would 

 significantly heighten its status in the global market. Third, as thecountry intensifies the export effort, business and trade opportunitiesare bound to open up, which the country can leverage to its

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advantage. Fourth, as firms satisfy the varying domestic demands for   products, they must see if the various versions are attractive toconsumers elsewhere. That is, with the same product range, adomestic vendor may succeed in foreign markets. Such opportunities

in the wake of globalisation are becoming incentives for many firmsto export. 

 Despite the process of reform and liberalisation, conducting businessin India still remains cumbersome and time consuming. And as the

 global market is vast, sourcing resources, a key to exporting, isbecoming easier and affordable. All these factors today generateinterest or propel local or domestic producers to go global.  As global trade expands, time is opportune for Indian exporters to invest in

 foreign markets and generate dollars. This can be used to pay for thecountry's crude oil imports.

Export challenge:

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  India is recognised as a robust service-based economy; servicescontribute around 55 per cent to GDP and account for a significant 

 share of world service exports. India has outpaced China in this area. However, in the non-traditional sector, especially in the field of 

technology-intensive manufacturing, the country has not been able toreplicate that success. So, for new and young entrepreneurs, thechallenges are many and formidable.

 India and China are seen as the key drivers of the world economy. At one level, they are in competition and at another they are cooperating with each other through joint ventures to maximise tradeopportunities. India's economy could be said to be in a comfortable

 position today as it has accumulated $160 billion in foreign exchange

reserves, clocked industrial production growth of 8 per cent, and  generated GDP of $800 billion.

 In comparison, China has foreign exchange reserves of $850 billion,and GDP of $1.9 trillion, and an economic growth rate of 8-8.5 per cent. But the advantage for India is that it is a low-cost destination for 

 foreign investors and, more important, has a large, English-speaking talent pool; here, again, India has a lead over China.

Today, China is perceived as the factory of the world. Its

manufacturing sector contributes almost 55 per cent of GDP. India'smanufacturing sector is not as vibrant, but it is showing signs of great vitality and rapid progress. Inflow of foreign direct investment and advent of MNCs in large numbers are helping the economy growbigger.

Traditional exports

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 India already has a strong base in traditional exports such as textiles,handicrafts, gems and jewellery, and the global demand in these

 sectors is significant.

With the right kind of technology and capital coupled with rich

cultural traditions and ethnicity, India can exploit these opportunities.Young entrepreneurs or start-up firms have to develop technology,capital and skill base to be able to export in a big way in these

 sectors.

 India's manufacturing sector has a great future even if China is muchahead of India. The total manufacturing export share of India today

 stands at $70 billion whereas China's is at $700 billion.

One of the biggest challenges of exporting is the issue of 

transparency. China does not score very high on this parameter. Therules and regulations relating to China's exports are not transparent and this acts as a big impediment for the global exporters to transact and operate in China.

On the issue of transparency, India has an edge over China, and  significantly the world recognises this. It is for the Government to sustain this openness and score over China on this count.

Strategies for export:

 Further, the developed world is also intimidated to a certain extent bythe economic might of China and is, therefore, looking at India, well 

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recognised in the international market as a vibrant parliamentarydemocracy, as an alternative for importing a wide range of technology-intensive manufacturing products.

This tag of reliability and transparency can help Indian exporters in a

big way. Promotion and substantial use of the "Made in India" brand must be pursued vigorously to capture markets. However, companiesneed to be alert in this area as the overseas markets are often not quite satisfied with Indian standards in matters of health, safety and environment (HSE). HSE is recognised as a significant non-tariff barrier (NTB) in the multilateral global trading regime. For developing countries this is a significant hindrance to exporting.Maintaining HSE standards on a par with international markets or 

 satisfying the foreign buyer is a challenge for Indian vendors.The manufacturing exports sector needs to adopt diligence,reliability, transparency vies-a-vies HSE norms. Indian companiesalso need to play up their tag of transparency and develop a system of continuous feedback to their foreign customers. Small and promising 

 Indian companies with a vision to export technology products need tomake considerable effort and formulate concerted strategies in

 planning their entry into the world market. This is a well spread out 

market that may look daunting but with the right strategies, small vendors can go places too and create a niche for them.

India's Export Performance:

Two notable developments have taken place in India's export front   since 1970s. First, as stated earlier its exports have grown much  faster than GDP. Second, there has been a substantial change in

 India's export mix. Several factors appear to have contributed to these

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developments, namely the real depreciation of exchange rate,liberalization in investment policy especially from the early 1980s and the provision of export subsidies to reduce the anti-export biascreated by the IS policy. Export subsidies took in may form duty

drawback, subsidized credit and direct subsidies- which help reduced the bias against exports.Whenever the real devaluation wasmaintained, growth in exports continued. A sharp devaluation of rupee since the early 1990s has further strengthened export growthalthough there was some slowdown and or declined in exports during the macro economic crisis of the early 1990s. Export growth also

 slow down in 1997-98 due partly to the Asian crisis. Indian exportsare dominated by manufactured goods which account for about 76%

 share by 1997-98- increased from 50% in 1970-71 (table3). Four major items (namely gems and jewellery, readymade garments,engineering goods, and chemicals and allied products) dominate itsmanufactured exports. With the exception of jewellery, all industrieshave received foreign participation. Engineering goods and chemical and allied products is the recipient of foreign investment since 1970swhile readymade garment was open for foreign investment only in thelate 1980s.

Models of Export Demand and Supply Functions:

Since export performance is influenced by both foreign demand and domestic supply factors we develop a simultaneous equation model to

explain India's export performance. On the basis of conventional trade theory one would expect that the lower the relative price of 

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  India's exports in relation to world export prices the higher thedemand for its exports. Hence, a negative link between the relative

  price of exports and export demand is expected. World incomeappears to have a positive impact on export demand and the

appreciation of the real effective exchange rate (REER) reducesexport demand .On the basis of theoretical reasoning one would expect a rise in export supply when the export prices rise relative todomestic prices and vice versa. Increase in domestic demand divertsexport supply towards domestic consumption, leading to a fall inexports. This leads us to believe that there is a negative link betweendomestic demand and export supply. The role of FDI in export 

  promotion in developing countries is ambiguous and crucially

depends on the motive behind such investment. If the motive behind  such investment is to by pass trade barriers in the host country, then it is highly unlikely that such investment would result in better export 

 performance.

 However, if FDI is motivated by the country's comparative advantage,then it may contribute to export growth. Thus, the nature of the link between FDI and export performance is not clear cut. Reliable and efficient infrastructure facilities are essential for reducing costs,ensuring timely supply of exports and thereby improving export 

  performance. However, many developing countries including Indialack reliable and efficient infrastructure facilities due mainly tounder-investment and the public sector intervention. This contributesto higher costs and poor export performance.

Thus, we expect a positive link between improved infrastructure facilities and export supply.

List of countries by exports:

 Ran

k Country

 Exports

 Million

US$

 Date of Information

 —  World  (sum 16,340,000 2008 est.

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of all countries)

1 Germany 1,530,000 2008 est.

2 China (PRC) 1,465,000 2008 est.

3 United States 1,377,000 2008 est.

 —   European

Union

1,330,000[1] 2005

4  Japan 776,800 2008 est.

5  France 629,700 2008 est.

6   Italy 566,100 2008 est.

7  South Korea 458,400 2008 est.

8  Netherlands 456,800 2007 est.

9

United 

 Kingdom 442,200 2007 est.

10 Canada 431,100 2007 est.

11  Russia 355,500 2007 est.

 —   Hong Kong  345,900 2007 est.

12  Belgium 322,200 2007 est.

13 Singapore 302,700 2007 est.

14 Mexico 271,900 2007 est.

15 Spain 248,300 2007 est.

16  Taiwan 235,500 2007 est.

17  Saudi Arabia 215,000 2007 est.

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18 Switzerland  201,000 2007 est.

19 Sweden 176,500 2007 est.

20 Malaysia 169,900 2007 est.

21  Brazil  160,600 2007 est.

22  Austria 158,300 2007 est.

23United Arab 

 Emirates152,100 2007 est.

24  India 151,300 2007 est.

25 Thailand  151,000 2007 est.

26   Australia 139,400 2007 est.

27   Poland  137,900 2007 est.

28  Norway 136,100 2007 est.

29  Ireland  124,800 2007 est.

30  Indonesia 118,400 2007 est.

ROLE OF EXPORTS:

 Is the instrumental role of exports in the economic growth process of 

a country dependent on the favourable world trading environment ?

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the observed growth performance cannot be attributed entirely to the growth in export volume. What one can expect to observe in data isthat rapid economic growth is more likely to be associated with the

 growth in export volume. The observed growth performance is the

result of both the autonomous shifts in PPF which are not identifiablein aggregate data and the trade-induced shifts which are taken to beinfluenced by the following factors :

(a) The gross elasticity of country’s export volume with respect to theworld trade volume. This reflects the degree of success of a givencountry in exploiting the world trading opportunities.

(b) The volume growth of country’s exports which indicates the success of a country in generating exportable surpluses.

(c) The net-barter-terms-of-trade which represent the terms of exchange associated with the export volume growth.

(d) The income-terms-of-trade which reflect the import-capacity of export earnings which may be taken to contribute to the growth

 process by relaxing the foreign exchange constraint and by removing   specific bottlenecks removable through imports. In the broad   framework discussed above, the expected positive associationbetween the rate of economic growth and the volume growth of 

exports is taken to be mediated through the movement in the net-barter-terms-of-trade and the resulting impact on the income-terms-of-trade. All these factors are expected to be affected by the volatilityin the world trade environment.

FEDERATION OF INDIAN EXPORT ORGANISATION:

The Federation of Indian Export Organizations represents the Indianentrepreneurs’ spirit of enterprise in the global market. Known

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  popularly as "FIEO", this apex body of Indian export promotionorganizations was set up jointly by the Ministry of Commerce,Government of India and private trade and industry in the year 1965.

 FIEO is thus a partner of the Government of India in promoting 

 India’s exports. Every year India earns billions of dollars by exporting various goodsand items from the country. The export trade of India is regulated bycertain export policies outlined by the Indian government including the products to be exported and the countries with which India cancarry out the transactions. The Federation of Indian Export Organizations is the leading export promotion organization of Indiawhich works in collaboration with the Government of India. The

export business is quite a lucrative business in India. Cruise throughthe following 10 links to get a clear and complete overview of theexport business of India:

Export Business in India:

Talking about exporting, importing and manufacturing business,  India goes ahead in all of these areas. India's skilled talent 

manufactures and exports a great array of products, which make ahuge marketplace offshore.

Several of the major parts which see India as exporting and manufacturing are:-

  Agriculture Industry - India's financial system is different fromothers, with farming being its foundation. India exports a huge hunk 

 from its agriculture stock, and various stuffs are heartily valued in the

international bazaar. A few goods that reach out to international audience directly from nations farms are Sugar, Tea, Spices, Wheat,

 Rice, Tobacco, etc.

Textile and Apparel Industry - Apparel industry has a unique placein India's export import data bank. After agriculture, textile industry

 sees India possibly, as the 2nd largest center of exporting to other country. If reviews are to be believed, Indian textile trade createsabout 30% of the total exports! Specialist orate that keeping in view

the constantly increasing demand of Indian textile and apparel industry, the position of this sector is bound to raise.

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Chemical Industry - Chemical trade makes a most important part of the Indian economy, contributing around 7% of the Indian GDP.

 India is inextricably connected with major chemical manufacturing,

then whether it deals with chemical drugs used in medicines, toiletriesand soap, dyes and paints or varied types of pesticides. These

 progression and accomplishments have forced India to take added  proposal in the field and hold the competition directly.

 Home Furnishing goods - Manufacturing of home products liketapestry, curtains, linen, cushions, etc., is not a single countries

 stance. India on the other hand leads the field by designing excellent 

textile items that speak their worth. The knitting, weaving and   spinning structure of these house-hold furnishing goods showcase  India's ethnic and artistic design model that has made anextraordinary place around the world. India earns a good-looking amount with the export and manufacture of Table Linen, Bed Linen,Curtains, Toilet and Kitchen Linen, Carpet and Floor Coverings, and other clothing accessories.

 Indian Jewelry - Indian jewelry region is completely attributed to theancient Indian society and civilization. The outstanding gems and 

  jewels that India has under its lap, clubbed with the astonishing artwork, makes it renowned in the international market. India trade

 jewelry and gems to U.S, UAE, U.K, Hong Kong, Singapore, Belgium,among others nations. Discussed above were the some areas where

  India has shown its guts in export and manufacturing arena. The Indian export industry is enormous and caters to an ample market. Like any other nation, a big part of India's economy is reliant on itsexporting.

Export Potential of India inLivestock Sector: Future Prospectsand Some Issues

  India is known for its livestock wealth and ranks high among the

nations having bovine population. However, despite having hugelivestock population, India stands insignificant in the world trade of 

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livestock products. The recent concerted efforts made by the

  government in the era of liberalization after opening up of the

national economy to the international market have certainly boosted 

 India’s export trade of livestock products to newer heights. The dairyindustry of India is already at a take-off stage and the entry of the

corporate sector following the liberalized policies of government is

bound to complement the efforts of National Dairy Development 

 Board (NDDB) to usher in a white revolution. The most important 

achievement of the dairy industry is the near-self sufficiency in milk 

  production. Nonetheless, the possibility of India emerging as a

 potential exporter of various livestock products will largely depend on

 India’s own ability to exploit her potential in this sector and generate

exportable surplus of these commodities.

EXPORT PERFORMANCE OFMANUFACTURED PRODUCTS:

We first spell out the motivation behind undertakings the comparisonof export performance between China and India. The protagonists of the import-substitution orientation in the Indian growth strategy haveadvanced one important argument against export-orientation that hasbeen undertaken since 1991. According to this argument, ‘small’ 

economies (defined by the small size of the population) with limited  size of the domestic market have no option but to specialize on the

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basis of comparative advantage in order to raise the living standards.On the other hand,‘large’ economies like India (defined correspondingly by the large size of the population) possess a

 potentially large size of the domestic market which can form a sound 

base for the import-substitution oriented diversified industrial  structure. As a result, such large economies derive very limited gains from international trade and hence export-orientation in their growth  strategies and hence trade liberalisation is unwarranted. Theargument can be easily refuted on the basis of a prior reasoning. One,even the static gains from trade depend entirely on comparativeadvantage and do not depend in any way on the size of the country’smarket.Two, the dynamic repetitive positive-sum game view of 

international trade makes the gains from trade dependent not on the  size of the market but on the interaction between the internal mainsprings of the growth process and external trading opportunities.

 Even if domestic market size is taken to be relevant, it is noted out long time ago that size of the market depends as much on per capitareal income and geography (affecting transport costs) as on the sizeof the population and that at low levels of real income per capita(which is correctly attributed to the low absolute productivity of labour), the size of the market which, expands as a result of autonomous shifts in the production possibility frontier (PPF) and these, in turn, are reinforced by the trade-induced shifts in the PPF,

 so that dynamic gains from trade can accrue to the countries withlarge population with low levels of real per capita income. However,in addition to the a priori reasonings, an empirical demonstration of the view presented in this paper in favour of export-orientation can be

  presented by undertaking a comparison of export performancebetween India and China, two of the world’s most populous

economies with reference to pace of opening up of these two relativelylabour-abundant and natural resource-deficient economies and theconsequent changes in their structure of comparative advantage and the diversification in the export basket resulting from the interactionbetween autonomous and trade-induced shifts in the production

 possibility frontiers.

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Export Quotas and Policy Constraints in the Indian Textileand Garment Industries:

Substantial export tax equivalents exist for Indian textile and clothing exports, especially to the United States. In today`s world, these would have been even higher if domestic Indian policy constraints had beenrelaxed. In tomorrow`s world, the health of India’s textile and clothing industries may depend on timely relaxation of theseconstraints. India’s  strengths in this sector lie in natural resourcesand factor endowments raw cotton and cheap labour. The Indian

  garment industry`s decentralized production structure

 subcontracting, which is low risk and low capital has served theindustry well but has excluded Indian products from the mass market 

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 for clothing, which demands consistent quality for large volumes of a  single item. Growth in Indian exports may require a shift to anassembly-line, factory-type system.

This would probably require:-

-No longer restricting garment production to the small-scale sector 

(and ending other outdated policies).

-Making labour policy more flexible

-Ending the policy bias against synthetic fibres.

- Reducing transaction costs for exports.

India’s export-import growthbetter vs other Asian countries:

MUMBAI: "In contrast to all other Asian countries, India’s export 

and import growth actually managed to surprise on the upside. While

exports dropped 1.1 % on the year the third consecutive contraction)

this was a lot better than the double-digit falls of October and   November," said HSBC's senior Asian economist Robert Prior 

Wandersforde.

FALL IN TOTAL WORK:

 According to a note put out by ABN Amro, the decline in incoming 

new business to Indian manufacturers, from both domestic and 

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  foreign clients, are easing sharply. Even so, data still signalled a

marked fall in total new work over the month. Respondents stated that 

customers were unwilling or unable to commit to new contracts due to

 global economic and financial difficulties, the report stated."Indian manufacturers reported leaner order books in January.

Uncertainty and falling demand, resulting from global financial and 

economic problems, were blamed for the lower inflow of new work.

 Although the seasonally adjusted new export orders index rose after 

that, almost as sharply as it fell last time, the latest figure still 

indicated a marked fall in new work from abroad," the ABN Amro

report said.

UNEMPLOYMENT:

 According to ABN Amro, lower workloads in January led companies,

in the Indian manufacturing industry to seek cost 

  savings."Employment suffered as a result, and job-shedding was

recorded in the sector for the second month running. However, the

rate of reduction in staffing numbers over the latest survey month was

marginally slower than during December," the ABN Amro report added.

India to miss export target: D&B:

 NEW DELHI: India is likely to miss its export target of $200-billion

this fiscal as exporters battle increase in credit risks amid slump in

demand in the developed economies, global research firm Dun and  Bradstreet said.

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“Exporters have been hit hard as credit risks are increasing besidesdemand is down significantly. We think in this scenario the country islikely to miss the export target of $200-billion this fiscal,” For thecurrent financial year, the trade deficit would be around $121 billion,

where in exports would be about $182 billion and imports would beabout $303 billion, the research firm said.

The outlook is negative in this sector and exports are likely to dip further as there is a crisis of confidence. Though the Government hastaken proactive and timely steps but there has been a significant dipin confidence level.

“The steps taken in the stimulus package were in the right directionand these steps would provide liquidity into the system. But more

needs to be done,”

OVERALL VIEW:

 Indian exports are steadily underwriting the country's growth story.Year after year, the numbers have been rising at the rate of 20 per cent. According to the department of commerce, merchandise exports

  for fiscal 2006-07 rose by approximately 25 per cent over the previous fiscal.

These figures offer proof of the upward mobility of India’s export  graph. A closer look at the trends shows that Indian ex-ports havebecome less volatile; exporters have widened their market base; and 

the trade basket is expanding. Services account for a large percentageof total ex-ports. In 2005-06, services ex-ports grew by 71% to $46 billion and by January 2006 had surpassed the previous year’s

 performance with 75% growth.

Software services constitute a major portion of the total package. According to Nasscom, software services exports grew by over 33%in 2005-06 to $17.3 billion. Demand has been strong in traditional aswell as new service sectors—supply management, engineering 

applications and a host of other such areas.

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 Adding to this buoyancy is the fact that Indian exports have becomemore resilient to exchange rate fluctuations. It is no longer a fear that a stronger rupee will lead to a drop in exports—a view that was quitecommon even in the late 90s.

  India no longer needs a weak rupee to make its products pricecompetitive. However, one must not look at Indian exports inisolation. A recent report observed: “It must be seen in the context of buoyant world economic growth in the region of over 4% a year, aswell as world exports, which grew by 5%, 17% and 21%, respectivelyin the past three years.”

Current trends, however, suggest that India has kept apace with global standards. Revenues have risen across most products—textiles,

 farm produce, meat and allied products, iron and steel, machinery, software and electronic goods—ranging between 5% to 15%, both involume and value. These figures indicate that Indian exports are nolonger dependent on the changing value of the rupee. Does this meanthat Indian goods have found themselves a market that is priceinelastic? Does the demand for Indian exports no longer depend onhow cheaply these goods can be produced?

While there may be no uniform reply across sectors, a certain

consistency can be seen in some segments of Indian indus-try. Thereare numerous instances of key industries that have broken the pricebarrier to become an integral link in the global supply chain of largeMNCs.

  For instance, the textile and automobile ancillaries industry. Autoancillaries exports grew by 33% in the last three years. Textilesexports, after a brief choke up, grew by 25% in 2006-07. In bothindustries, growth has come significantly from supply contracts with

  some of the world’s largest automobile companies and retailers.These contracts promote long-term alliances and supply of largevolumes. Both these factors are critical in creating an export basket that can withstand exchange rate and other such shocks.

 A similar story is unfolding in the manufacturing sector where exportshave risen by 9% in the last two years. To a large extent, this surgecan be attributed to the strengthening of the Indian machinery and mechanical appliances sectors, apart from an overall rise in demand 

  for steel in the world. According to a recent report, the nature of 

manufacturing exports from India suggests that we could be becoming internationally competitive.

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The other trend scaling up optimism over exports is the emerging  pattern of trade. While the US and the UK remain dominant markets, Indian companies are making gains in newer geographies such as Asia, Africa and Latin America. China and Singapore are India’s

third and fourth largest trading partners, respectively. For trade analysts, it’s a good sign. With India expanding its export base, it is spreading its risks and increasing the scope of its traderelationship. This is the perfect buffer against a trade disaster. Withthe export basket filling up with a wider range of products and 

 services, and the markets expanding, exports are looking to establishtheir presence globally. The years ahead will be a test of patience,

 perseverance and skill as they do so.

India's export sector heading for aslowdown:

 Research has said that India is facing a threat of dwindling exports asleading world economies are heading towards a slowdown and the

country's trade deficit for the current fiscal is expected to be around USD 121 billion.

 Exporters of the country are under increasing pressure as the US,which is the single-largest export destination for Indian goods and accounted for Indian exports in 2007-08, is heading for a possible

 slowdown.

Considering the magnitude of trade transactions and the current economic environment in the US, it has become even more imperative

  for Indian businesses, especially exporters, to exercise abundant caution in cross-border transactions.

"As India is an export-led country, slowdown in the global economiesis likely to dent the growth prospects for India. For the current 

 financial year we are projecting 7-8 per cent growth; however, thecoming year looks challenging,".

"Exporters should adopt more caution. They should go for credit checking of their buyers, monitoring of their buyers and insuring their exports among others,".

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The situation is likely to normalise in the next two years, the report added. Meanwhile, financial services major Citigroup has said 

 India's trade deficit is likely to widen by 39 percent to USD 111.6 bnduring the current fiscal, while banking behemoth Goldman Sachs

also said Indian exports are likely to slow further as external demand continues to dip.

India: The Growth Outlook 

  It appear that some slowdown in the pace of expansion of the US 

economy is likely and this may lead to slower growth in developing 

economies as a result of lower rate of export expansion. This is

however likely to be offset by continued growth in domestic marketsand the relatively mild nature of the slowdown. The Indian economy

is much less dependent on the external markets than the Chinese

economy, for example. Thus, while some export demand compression

is likely to put an additional burden on our exporters of goods and 

  services, it is unlikely to be large enough to significantly depress

 growth. However, the flip side to this is that the pressure on the prices

of oil, food and other raw materials is likely to continue, making inflation management in 2008/09 quite challenging.

The impact of the appreciation of the Indian rupee vis-à-vis the US dollar and other major currencies has been a major source of concern. Industry apprehends a decline in India’s share in export markets as well as possible adverse consequences on thecompetitiveness of Indian manufacturing, or at least in some sectionsof it. It is interesting to note however that several items have bucked 

the trend, notably engineering goods and man-made textiles and 

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made-ups, which registered smart gains in US dollar terms that translate into sizeable gains even when measured in rupees, namely of 8% and 9% respectively. Gems & jewellery was up by 12% in rupeeterms and refined petroleum products by 9%. In the majority of 

 goods, especially those that formed an important component of theresurgence of Indian exports after 1991, there has however beenerosion in export value when measured in Indian rupees. Thus,apparel was down by 13%, cotton yarn, fabric & made-ups by 12%,handmade carpets by 18%, and handicrafts by 50%. The rupee export value of leather products fell by 5% and chemicals by 2%. In thesebusinesses, therefore, there was a contraction of export business and to the extent the domestic market could not accommodate diversion of 

output, a contraction of business in absolute terms as well.

CONCLUSION:

Future of India's Exports: Need for Evolving a

National Export Strategy:

Considering both the strengths and weaknesses of India’s recent export performance, it is difficult to conclude with conviction that 

 Indian exports have now taken off for a self-sustaining rate of growth

in real terms at the rate experienced in 2007. There is indeed no room

 for complacency on the export front. The recent performance however 

does provide hopes that with concerted efforts at all levels, through a

well formulated and implemented national export policy, the export 

  sector can be made to yield the maximum potential contributionwithin limits which it can make to the national economy in the coming 

 years.

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BIBLIOGRAPHY:

➢  Business line. ( business daily from the Hindu group of 

 publications )

➢  The financial express.

➢  ABN Amro. (economictimes.indiatimes.com)

➢  Google search engine.➢  Wikipedia.