Indian Exports Research Articles

ANALYSIS OF EXPORT COMPETITIVENESS TEXTILE AND APPAREL INDONESIA, CHINA, INDIA

The textile and apparel industries are labor-intensive and capital-intensive industries. The focus of this research looks at the competitiveness of textiles and apparel in Indonesia, China and India. The research method used is comparative descriptive, with the Herfindahl approach, Trade Specialization, Relevealed Comparative Adventage and Constan Market Share. Herfindahl calculation shows the market structure in Indonesia, China and India in the form of perfect competition. While the Trade Specialization approach, Indian exports are more stable than Indonesia and China. The TSR approach generally shows Export Promotion. The Revealed Comparative Adventage approach, Indonesia and India show stable and stagnant results, the RCA scale shows that China has a comparative advantage and strong competitiveness. Conclusion of the research, the market structure takes the form of a perfect competition and Export Promotion. China Has comparative advantages and strong competitiveness, followed by Indonesia and India.

Assessing working capital management efficiency of Indian manufacturing exporters

PurposeThe purpose of this paper is to empirically investigate the relationship between working capital management (WCM) efficiency and exogenous variables of the Indian manufacturing sector along with its sub-industries that are involved in export activities.Design/methodology/approachPanel regression (fixed effects) was used on a sample of 563 Indian manufacturing firms involved in export activities, covering a time period from 2008 to 2018.FindingsIndustry-wise results showed a significant relation of leverage, net fixed asset ratio, profitability, asset turnover ratio, total asset growth rate and productivity with cash conversion cycle (CCC).Research limitations/implicationsFirstly, having taken a sample from a developing economy, the results of our study may be generalizable only among developing contexts. Secondly, the time period taken in this study (2008–2018) has witnessed several economic fluctuations such as recession and demonetization which might differ for the firms or countries in normal conditions.Practical implicationsAn improved working capital model could advance the firms' performance by reducing the CCC of the firm, thereby creating efficiency in WCM. In addition, the results of this study could be helpful for many stakeholders such as working capital managers, debt holders, investors, financial consultants and others for monitoring the firms.Originality/valueThis study contributes to the existing literature in the relation between WCM efficiency and exogenous variables of the Indian manufacturing firms engaged in the export activities. Moreover, this study is one of the few research studies to investigate this relationship among Indian export firms in different industries, thus filling the gap in similar work done in other countries.

Fisheries Exports of India: A Constant Market Share Analysis

The present study analyses the performance of fisheries exports of India using revealed comparative advantage (RCA), revealed symmetric comparative advantage (RSCA) and the constant market share (CMS) analysis for the period 1980–2016. Indian exports of fisheries have shown a positive trend of comparative advantage in all the markets under consideration revealed by RCA and RSCA. However, CMS results show that for most of the markets, competitiveness had been the utmost crucial driving factor of change in the market shares of Indian fish exports over the study period.

Global auto industry and product standards

Global auto industry and product standards

Anatomy of Non-tariff Barriers in India–Sri Lanka Free Trade Agreement: An Empirical Investigation

This article attempts to answer one crucial research question: why the utilization of India–Sri Lanka Free Trade Agreement (ISFTA) route for trade is very poor by the Indian exporters (13%) as compared to their Sri Lankan counterpart (65%) even after one decade of its implementation? The available studies have blamed the non-tariff barriers (NTBs) which are hamstringing the growth of trade between these partners development of international trade. However, these have considered NTBs as subset of non-tariff measures (NTMs) which are quite narrow sense of finding the hidden barriers within the International trade process. Therefore, this article has analysed in detail the logistic process involved in international trade between India and Sri Lanka to understand various NTBs sheltered within this logistic process. Further, the article has identified issues which are not directly beyond the logistic process which are affecting the international trade between these two countries. JEL: F0, F1

Trade War: Likely Impact on India

The global financial crisis triggered the built up of domestic pressure in some countries to introduce protectionist measures against imports. The present discussion regarding the ‘trade war’ and ‘de-globalisation’ intensified after both the US and China escalated the tariff rates on imports originating in the US and China. This study evaluates the potential economic effects of the substantial tariff hikes by these two major economies on Brazil, Russia, India, China and South Africa, particularly for India. The study adds to the existing literature on the trade war by examining potential impact on India’s exports, that is, both direct and indirect losses as well as benefits arising due to the trade war using the economic model based on the trend in trade flows, similarity index and supply chain networks using World Input-Output tables. The study uses the Vector Error Correction Model to empirically evaluate the pass-through of the tariff hike on Indian exports using bilateral real effective exchange rate (REER)-consumer price index and REER-product price index. The study finds that the US–China trade tussle may provide some opportunities in short to medium run for India as gains through trade deflection would be higher than the losses due to trade reduction. However, in the long-run, further escalation of tariffs will have negative impact at the global level. JEL Codes: F1, F62, F68

Information and communication technology (ict) and trade in services in India

In recent decades, trade in services has recorded impressive growth that surpassed the growth in merchandise trade. The globalisation and development of technology shrink the world that helps in the growth of service trade. Traditionally, services were considered as non-tradable item due to its intangible nature. Unlike merchandise trade, services cannot be stored and it requires direct interaction of service provider and service receiver for delivery. In cross border supply of services, it may not be possible all the times that service provider and service receiver would available at the same point of time. Such a time gap between the service provider and receiver can be filled with the help of Information and Communication Technology (ICT). The growth and developments in ICT across the globe open new dimensions of service trade. The ICT is also the backbone for trade in a large number of services such as computer services, banking and insurance, consultancy etc. The study has attempted to analyse the role of ICT use in international trade in services. The study reveals that ICT has a positive impact on service export in India but it is found insignificant for non-IT based service export.

An Analysis of the Relationship among Economic Growth, External Debt and Exports in India (1970-2018)

This paper attempts to examine the relationship among debt servicing, exports and GDP for India during 1970 – 2018 using co-integration test, error correction model and Granger causality test. In the bi-variate model with constant trend specification GDP and exports seem to have no long-term relationship. However, change in GDP Granger causes change in exports. For the restricted constant trend specification, in the short run, GDP affects exports positively and significantly. GDP and debt services seem to have a positive and significant long-term relationship in the bivariate model. The tri-variate model including GDP, Exports and debt service reveals a long term relationship among the variables where both exports and debt services affect GDP positively and significantly. GDP, exports and debt stocks do not have any long term relationship with constant trend specification, but change in GDP is found to Granger cause change in exports. For the restricted constant trend specification, however, there seems to be a long term relationship among them. In the short run GDP affects exports positively and significantly. In general, results indicate a positive and significant impact of GDP on exports. A significant positive long run impact of external debt on economic growth is also observed when debt service is the indicator of external debt. The short run impacts of external debt in terms of both debt servicing and debt stocks, however, produce diverse and insignificant results.

Cointegration and Causality Study Among Inward FDI, Economic Growth and Exports

One significant feature of liberalisation for India has been a greater openness to foreign direct investment (FDI) as a means of acquiring technologies, skills and access to international markets, and of entering dynamic trade and production. The study analyses the empirical relationship between inward FDI, economic growth and exports of India from 1970-71 to 2013-2014. The objective of this article is to investigate the relationship between FDI, economic growth and exports empirically. The error correction coefficient value indicates a 15.02% movement back towards equilibrium following a shock to the model, one time period later. OLS indicate significant long-term causality relationship among the variables with high R2 value to the tune of 0.758660. The Wald Test establishes short-run causality from economic growth to inward FDI, and from exports to inward FDI. A one-way causality relationship is running from exports to inward FDI. Economic growth causes inward FDI, but, inward FDI is not causing economic growth. Exports cause inward FDI, and inward FDI does not cause exports.

Measuring Potential and Performance of Indo-ASEAN International Trade Using Gravity Model Approach

International trade is a key component of the global growth strategy. It is a tool that can carry the changes needed in the countries' factor-endowments. Keeping factor-endowment in mind we find an enormous potential for India's exports to ASEAN economies to increase, taking into account the inherent advantages of different product categories. During the pre and post-ASEAN-India Free Trade Agreement (AIFTA), India's trade ties with ASEAN have changed. The current research uses the 2010 to 2019 panel data to apply the gravity model of foreign trade between India and ten ASEAN members. The Trade Flows, GDP, Distance, Population, Border Sharing, and Common Language panel data obtained from the official website of DGFT (directorate general of foreign trade), WTO, and CEPII database are used for this purpose. In the current study, we have used an extension of the original model (by Walter Isard in1954) to establish the gravity model of international trade between India and ASEAN countries. To create a gravity model of international trade, the ordinary least square gravity model method was applied to the collected data. It was found that there is a trade opportunity between India and ASEAN countries from the findings of gravity trade models. The Indo-ASEAN trade relationship between goods and services will continue to be a mutually beneficial relationship that will enhance the effectiveness of capital markets, encourage investment, and create new opportunities for India and ASEAN to deepen trade.

Agriculture Trade Scenario in India and Its Global Comparisons

Indian economy has undergone structural changes over time with the anticipated decline in the share of agriculture in GDP. Despite a fall in its share from 55.1 percent of GDP in 1950-51 to 15.35 percent in 2015-16, the importance of agriculture has not diminished mainly for two reasons. First, country achieved self-sufficiency in food production at the macro level, but still a food deficit country facing massive challenges of high prevalence of malnourished children and high incidence of poverty. Second, the dependence of the rural workforce on agriculture for employment has not declined in proportion to the sectoral contribution to GDP. It is in this context of rapid transformation of trading environment in India and the world as a whole, an attempt has been made to examine the growth pattern of agricultural sector in India. The study also examined the commodity composition and structural changesinagricultural exportsand direction of agricultural exports of India from 1991-92 to 2013-14. The study reveals that in 24 years of post-reform period, the growth of agriculture and allied sector has not been stable. It is more or less dependent on monsoon which shows the backwardness of the Indian agriculture sector and failure of new reforms to improveagriculture sector. Trends in imports and exports show that integration of Indian agriculture with global economy has improved considerably during post reform period. But still percentage of imports in total imports is quite less and percentage of exports to totalexports has shown declining trend during the post reform period particularly post-WTOperiod. Regarding the international comparisons of India with other countries, the study depicts that India lags behind the world in all the major indicators of agricultural growth. India is also facing critical situation as regards the production and yield of selected commodities. As most of the farming in India is monsoon dependent. Irrigation problems have to be addressed by the government. Indian agricultural productivity is very less as compared to world standards due to use of obsolete farming technology. Sustainability in agriculture is of utmost importance. When proper technology (in water management at the regional, state and national levels as well as crop plan of what to produce and where to produce) is used, it will be a win-win situation for both the farmers and the country.

Textile industry in new India: challenges and opportunities

Textile industry contributes 2% of Indian economy as the second largest source of employment. It has 15% of Indian export earnings and investments are vital for its growth. Upgradation through modernising the machinery to ensure overall efficiency, innovative processing and working capital management are some of the important exponents to enhance the status of industry. Manpower availability and compliance of labour laws are very crucial to meet international standards. Obviously global standards face a variety of challenges across the frontiers to assume leadership in the trade which necessitates domestic productivity. 'Make in India', 'Startup India' and 'ease of doing business' can boost foreign direct investments in India. 'Ease of doing business' will facilitate capacity building and support the reforms in labour legislations, improvement in logistic performance etc. These factors will strengthen the industrial performance by availing opportunities to achieve the status of a benchmark to capture international market.

Dynamics and determinants of trade exchange between the European Union and India

Purpose – This article attempts to identify and assess trade exchange between the European Union and India, including an indication of the main determinants of the process. Research method – Descriptive analysis based on numerical data from various statistical sources together with a review of specialist literature. Results – Trade exchange between the EU and India is particularly important for India. Exports to the EU account for around 17-20% of Indian exports in total. On the other hand, the EU’s share in Indian imports amounts to 10-12% of all imported goods. Trade with India looks different from the EU side. India’s share in both exports and imports presents a margin for EU trade in goods of 2-3%. The share of services in the trade between the EU and India is high. It accounts for 25-30% of mutual turnover. These are usually modern services based on the offshoring principles, such as IT, business, transport, consulting, science, and tourism. Among the European Union Member States, India’s main trading partners in goods are Germany, the United Kingdom, Belgium, France, the Netherlands, and Italy. These six countries account for ca. 85% of the EU-India trade exchange. In 2007, negotiations started to create an EU-India Free Trade Area. Due to the large differences in the positions of both parties, these discussions were not finalised and were subsequently suspended in 2013. However, after the reactivation of talks in 2016, there is still a possibility for the creation of an EU-India Free Trade Area of 1.8 billion people. Originality /value / implications /recommendations – At the beginning of the 21 st century, in terms of GDP (according to PPP), the European Union (understood as one economic entity) became the second largest economic power globally (after China), while India advanced to fourth position (after China, the EU and the USA). An analysis of trade exchange between these two economic powers allows for a clearer understanding of the modern global economy, as well as the processes and mechanisms of its functioning.

Determinants of Exports in India

This paper examines the responsiveness of exports to FDI taking into account responsiveness to other determinants. Using 46 year annual data of the variables and applying various time series techniques such as unit root, cointegration, ARDL and ECM; the results show cointegration relationships among the variables as a whole. The results also show the existence of long run and short run causality from the determinants to exports.

Impact of Export and Import on Economic Growth: Time Series Evidence from India

This paper examines the cointegration and causal relationships between export, import, and economic growth in India using quarterly data from 1996:Q2 to 2019:Q2. Stationarity properties of the time series data are investigated using Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) unit root tests, and the existence of cointegrating relationship is studied using Johansen’s cointegration test. Finally, the causal relationships between the variables are examined using Vector Error Correction Model (VECM). The results show that, under both tests, the time series variables are non-stationary at their levels and are stationary at their first differences. The Johansen’s cointegration test shows the existence of a long run equilibrium relationship among the variables. The results from the VECM indicate that there is a unidirectional causal relationship running from economic growth to import in India. This implies that with an increase in the income of the nation, the nation’s spending will increase, and some of the spending will be on import.

An Analysis of Export Financing of Indian Handicraft Industry

The paper attempts to study the RBI initiative with respect to Export financing for boosting Indian Exports. It is of great importance that the country’s exports be stepped up, so as to reduce the trade and current account deficits to sustainable levels. Apart from export incentives provided to exporters, RBI and Government should also ensure that the exporters are provided credit facilities at a reasonable rate of interest. The paper covers the existing financing policies of the RBI and also on issues relating to various difficulties being faced by exporters with regard to availability of credit, factoring and other procedural issues in their dealings with banks and financial institutes.

Imbalance of carbon embodied in South-South trade: Evidence from China-India trade

China and India are the countries with the largest increase in carbon emissions and one of the fastest growing economies in the world. A better understanding of the carbon emissions embodied in China-India trade can service to curb carbon emission in both countries. In this work, we investigated temporal change and driving forces of the carbon emissions embodied in China-India trade from 2000 to 2015 using the Multi-Regional Input-Output model and Structural Decomposition Analysis. The results showed China was a net exporter of embodied carbon and a net exporter of trade in China-India trade, which indicated that China increased its environmental costs while gaining economic benefits. And the imbalance in China's embodied carbon trade was far greater than the trade imbalance. The industrial structure of China's export of embodied carbon and India's export of embodied carbon were difference, although electricity and heavy manufacturing industries dominated the embodied carbon exports of China and India. The decomposition results showed the leading contributor to increase in the embodied carbon emissions of China and India was the increase in final demand, in which the effect of per capita demand was the main driving factor affecting the change of embodied carbon emissions. The carbon intensity coefficient effect was the driving factor in suppressing the increase in embodied carbon emissions in China and India. This research could enrich the study of carbon emission embodied in South-South trade.

The nexus between financial development and trade performance

Purpose This study aims to empirically examine the relationship between financial development and trade performance for the Indian economy through a time-series analysis with annual data over the period 1980-2016. Design/methodology/approach The study uses new econometrics techniques such as unit root tests in the presence of endogenous structural breaks and autoregressive-distributed lag bounds test for the analysis. Findings Empirical results reveal that the level of financial development has a significant positive impact on the exports, imports and trade balance of manufactured goods for the Indian economy. Practical implications The findings suggest that the positive effect of financial development on trade performance is a potential mechanism through which the former may affect overall income and growth rates. It also implies that standalone trade liberalisation policies are insufficient to increase Indian exports. Indian policymakers should, therefore, consider the implications of the next set of financial sector reforms on the country’s trade flows, besides their positive impact on the economic performance. The findings are particularly relevant in the present scenario when the export growth is decelerating and there is a marked slowdown in private credit flows because of the problem of non-performing assets. Originality/value This study is the first of its kind which provides a holistic analysis of the relationship between financial development and trade performance for the Indian economy and also investigates the direction of causality between financial development and international trade by considering the possible presence of multiple endogenous structural breaks in the data. Moreover, in contrast to the available literature, the present study focuses on net exports as a key indicator of trade performance rather than trade openness.

Export - Import Performance of Natural Rubber in India

This paper assesses the performance of rubber exports during the period of 2010 -2011 till 2017 - 2018. Indian Rubber is an export promotion strategy promoted by the Board since 2011 with an objective of distinguishing Indian rubber in international market with its discerning quality features. The board is promoting export as a market intervention strategy to adjust imbalances in the domestic market owing to unscrupulous imports of rubber. Exports during this peak production period are at high level from December 2016 to March 2017. The exports of rubber from India jumped to 650 tonnes during April 2018 to October 2018. The price of natural rubber (NR) in India had been ruling high over international market prices since December 2013. The surge in international rubber price was due to the amplified demand for rubber from China. United States and the European Union together contribute nearly 70 % of India's overall rubber products' exports. Indian exporters, however, are looking to raise India's share in the world market to 5 per cent in the next couple of years from the existing 1.48 per cent compared to China's market share of 11 per cent. This paper examines the export and import performance of rubber from India. Researcher has collected the secondary data from various sources such as DGCIS, EXIM Bank annual reports, etc. This paper brings out the relationship between the export and import performance of rubber from India and the trade performance of Natural rubber, ratio, Pearson's Correlation Coefficient and One - Way ANOVA has been used for analyzing appropriate results.

Consumer buying behavior and attitude towards pharmaceuticals

Pharmaceutical industry is a fastest growing industry in India. It is valued at above US 40 billion dollars. India exports large amount of drugs to difference parts of the world. Nowadays people are conscious of what they buy. Even if doctors prescribe a medicine, consumers resort to internet to get more information on the medicine before they consume it. Consumers have different perceptions on various kinds of drugs. Understanding the consumer attitude towards drugs will help the marketers to formulate marketing strategies better. The present study examines as to what the consumers look out when they reach to purchase a drug from the pharmacy. This paper scrutinizes and gives insights on consumer behavior and their attitudes towards buying different types of pharmaceuticals (like over-the counter drugs, herbals, ayurvedic, analgesics etc). The paper highlights the importance of factors like price, trust and brand in making importance purchase decisions. Further it was also observed that most of the people prefer buying over-the-counter drugs, which might end up being misused by the consumers. However, it was also found that consumers try to be well-aware of the medicine before buying or consuming it. Along with it, price sensitivity is something which majorly dominates the buying behavior of the consumers.