A Study on Impact of Foreign Trade in India in The Post Liberalisation Era

Abstract

Foreign trade makes a significant contribution to the economy growth of a country. The policy regime in India with regard to liberalization of the external sector has brought tremendous changes in India’s foreign trade. So, the present study attempts to analyse the trend and composition of foreign trade since 1991 and also to analyse the impact of trade on the economic growth of India. The study reveals that though the total exports and imports both have increased but the growth rate of imports is more than the growth rate of exports. It is also found that manufactured goods compose major portion of the export goods while petroleum and crude products contribute major portion of the imported goods. The study also reveals that import has a negative influence on economic growth while export and economic openness are positively related with the economic growth of India.