India, having set an ambitious goal to export merchandise worth $400 billion in FY22, is now firming up plans to boost the  exports of key products where its share has traditionally remained small in the global market. According to an analysis by exporters body of FIEO, India has the scope to substantially raise its exports among a number of products such as medial & surgical equipment, mechanical machinery, sports goods, toys, electronics and certain farm commodities.

For instance, in the electronics segment, India accounted for only 0.5% of the global supplies of $2,900 billion in the previous year. Similarly, in 2020, while the global imports of mechanical machinery & parts stood at $2,142 billion, India's exports were just $18 billion with a share of under 1%.

Huge scope for improvement in exports for the below mentioned sector (Source: FIEO, 2020)

There is no doubt that in the past 5 years, India's exports have risen at a faster pace than the global average rate in such consumer & capital goods as mentioned in the above table, it was aided by a low base. The FIEO's analysis is part of its broader exercise to devise new strategy to improve exports. More importantly, the roll-out of production linked incentive schemes for electronics in the last year, will help boost our manufacturing base which will ultimately help outbound shipment.

In the medicals equipments sector, India's exports were only around $3.1 billion against the total global imports of around $592 billion in 2020. In sports goods and toys sectors, India's export stood at just $380 million, against the global imports of $120 billion in 2020. As such, India's exports have trailed the global average in the last 5 years through 2020. While, the global imports during 2016-2020, grew at a compounded annual growth rate (CAGR) of 3%, India's export rose at only 2%. In 2020, the outbreak of the pandemic and consequent lockdowns impacted India more adversely than most others.

India's job-intensive sectors falter (%CAGR of exports, 2016-2020) 

However, the matter of concern is that the exports from labour-intensive sectors are losing their share in the global market. In the last 5 years through 2020, in the gems & jewellery sector, the global imports grew by a CAGR of 5%, while India's exports shrank by a CAGR of 12%.

Similarly, while the woven garment imports remained constant worldwide during the period of the 2016-2020, India's exports shrank by a CAGR of 8%. In the leather footwear sector, while the global imports grew by a CAAGR of % during 2016-2020, India's export shrank by a CAGR of 7%. However, in certain farm commodities, such as tea, coffee, spices, preparation of food & vegetables, preparation of meat & fish, India's CAGR in exports has been more than the double that of global imports during 2016-2020. Here the country needs to build upon what it has achieved in recent years.