Role Of Foreign Trade In Indian Economy

Over the last 60 years, India's foreign trade has undergone a complete change in terms of composition and direction. The exports cover a wide range of traditional and non-traditional items while imports consist mainly of capital goods, petroleum products, raw materials, and chemicals to meet the ever-increasing needs of a developing and diversifying economy. In recognition of the growing importance of the foreign trade in driving the economy, this book describes and examines changes in the pattern of India's foreign trade since Independence in 1947, with focus on post-1991 developments. The book addresses issues related to trade policy, export strategy, tariff policy, current account dynamics, exchange rate management, foreign exchange reserves, capital account liberalization, external debt and aid, foreign investments (both direct and portfolio), and the WTO.

In recognition of the growing importance of foreign trade in the Indian economy, this book provides a comprehensive description and analysis of post-Independence developments in India's foreign trade and allied sectors with focus on post-1991 period. The book covers the following specific topics: Changing Pattern of International Trade; Pre- and Post-Independence Developments in India's Foreign Trade; Compositional and Directional Shifts in Exports from India; Compositional and Policy Shifts in Imports into India; Foreign Trade Policy in Recent Years; Rationalisation, Simplification and Moderation of Customs Tariff Regime; Current Account Convertibility and Flows; Capital Account Convertibility and Flows; Exchange Rate Determination and Management; Foreign Exchange Reserves; External Debt and Aid; Foreign Direct Investment (FDI) and Foreign Portfolio Investment. The book provides special coverage to the following topics: (a) Globalisation and International Trade, (b) Global Economic Crisis and International Trade, (c) India's Regional Trade Agreements (RTAs), (d) World Trade Organisation (WTO) and India's Foreign Trade and (e) Global Economic Crisis and the Indian Economy.

The world's economy has changed rapidly, in both the horizontal and vertical spectrum. These changes clearly demonstrate that no nation can isolate itself completely from the rest of the world and survive. Additionally, the recent explosion of information technology has generated new waves of dynamism and has virtually reduced the entire world into a global village. International trade is considered a catalyst agent for sustaining and accelerating economic growth. All the factors of production are not adequately available in a single country. Hence, countries engage in international trade, mitigating the disadvantages of disproportionate geographical distribution of productive resources. International trade decidedly increases the exchangeable value of possessions, means of enjoyment, and wealth of the countries concerned. For about 40 years, foreign trade in India suffered from strict bureaucratic and discretionary controls. However, beginning in 1991, the government of India introduced a series of reforms to liberalize and globalize the economy. The major changes to trade policy in the post-1991 period have included: simplification of procedures, removal of quantitative restrictions, substantial reduction in the tariff rates, liberal inflows of private capital, shift towards market-determined exchange rate, focus on export growth, and entering into regional trade agreements. In view of the growing importance of foreign trade in India's economy, this book provides a comprehensive description and analysis of post-1991 developments in the country's foreign trade.

For about 40 years (1950-90), foreign trade of India suffered from strict bureaucratic and discretionary controls. Similarly, foreign exchange transactions were tightly controlled by the Government and the Reserve Bank of India (RBI). From Independence in 1947 till mid-1990s, India, with some exceptions, always faced deficit in its balance of payments, i.e. value of imports always exceeded the value of exports. Exports remained relatively sluggish owing to lack of exportable surplus, competition in the international market, inflation at home, and increasing protectionist policies of the developed countries. Beginning 1991, the Government of India introduced a series of reforms to liberalise and globalise the Indian economy. Indias approach to openness has been cautious, contingent on achieving certain preconditions to ensure an orderly process of liberalisation and ensuring macroeconomic stability. The broad approach to reforms in the foreign trade sector was laid out in the Report of the High Level Committee on Balance of Payments (Chairman: C. Rangarajan), 1993. The major trade policy changes in the post-1991 period have included (a) simplification of procedures, (b) removal of quantitative restrictions, (c) substantial reduction in the tariff rates, (d) moving towards current account convertibility, (e) liberal inflows of private capital, (f) shift towards market-determined exchange rate, (g) gradual liberalisation of restrictions on outflows, (h) focus on export growth and (i) attracting non-debt creating capital flows. In recognition of the growing importance of foreign trade in the Indian economy, this book provides a comprehensive description and analysis of post-Independence developments in Indias foreign trade and allied sectors with focus on post-1991 period. The book contains 19 chapters which are categorized into the following six theme parts: Part I: International Trade: Theoretical Settings and Emerging Pattern. Part II: Indias Foreign Trade Policy and Developments. Part III: Indias Exports, Imports, Customs Tariff, and Special Economic Zones (SEZs). Part IV: Exchange Rate and Convertibility. Part V: Foreign Debt, Aid and Investment. Part VI: WTO and Indias Regional Trade Agreements. Besides, there are the following 3 appendices: Appendix 1: Text of the Foreign Trade Policy (FTP), August 27, 2009 to March 31, 2014. Appendix 2: Group of Twenty (G-20). Appendix 3: E-commerce. Other features of the book include □ Year-wise Review of Developments in Indias Foreign Trade: 1947-48 to 2011-12 □ Glossary of Trade-related Terms □ Time-series Statistics of Indias Foreign Trade □ Bibliography □ Index.

Monograph, emanating from a research project on foreign trade regimes and economic development, on the evolution of trade policy and foreign exchange controls in India - covers trends since 1948 in respect of price controls, import restrictions, currency devaluations, trade liberalization, export subsidies, domestic savings, etc. References and statistical tables.