It is necessary
to reduce foreign trade deficit
According
to the data presented by the Department of Commerce recently on August
14, the foreign trade deficit was $
85.58 billion in the first four months
of the current financial year 2024-25 from April to July 2024. Last year, the foreign trade
deficit was $ 75.15
billion in the same period. Especially the trade deficit with China has
increased further. In such a situation, now the country is seeing a new need to
reduce the growing foreign trade deficit and increase exports. According to
Union Agriculture Minister Shivraj Singh Chouhan, in the budget of this
financial year 2024-25,
effective efforts will be made to increase agricultural exports by
appropriately implementing strategic initiatives to increase agricultural
exports. According to Union Industry and Commerce Minister Piyush Goyal, every
effort will be made to increase goods and services exports from India this
year. There is no doubt that after the coup of Prime Minister Sheikh Hasina in
Bangladesh recently and the fear of recession in many countries of the world
including America and Japan, new challenges of India's foreign trade deficit
are emerging. It is noteworthy that Bangladesh is India's 8th largest export market and in
the last year 2023-24,
India has exported goods worth $ 11 billion to Bangladesh. It is important that in this financial year, India
has set a target of total exports to reach a record high of $ 800 billion, a little more than last
year, in such a situation, due to the Russia-Ukraine war, Israel-Hamas war, Red
Sea crisis and shortage of containers, along with achieving this challenging
target of exports, the foreign trade deficit will have to be reduced by
reducing imports appropriately. Certainly, the coalition government of Prime
Minister Narendra Modi's third term will have to move forward on mission mode
in view of strategically controlling the growing foreign trade deficit and
increasing the pace of exports. For this, five types of multi-dimensional measures
will have to be ensured. One, bilateral talks should be increased to breathe
new life into India's foreign trade. Two, the unprecedented budget allocations
ensured to increase exports under the budget for the year 2024-25 should be effectively utilized from
the very beginning. Three, service exports should be increased in every
possible way. Four, exporters should be given relief from non-tariff barriers
and five, new potential export markets should be explored. There is no doubt
that at this time the new coalition government is certainly moving ahead with
the goal of increasing exports from India and reducing the trade deficit amid
the challenges of global trade. Recently on July 11, India tried to breathe new life
into BIMSTEC (organization of countries located around the Bay of Bengal) in
New Delhi. India is constantly taking initiatives to increase bilateral trade
and mutual cooperation under the initiatives of Neighborhood First and Act East
and Sagar Policy to increase foreign trade. Similarly, India has started a new
exercise to increase trade through bilateral talks with friendly countries
including Russia and various developed countries. In this context, during his
three-day visit to Russia and Austria from 8 to 10 July, Prime Minister Modi has
taken forward new possibilities of foreign trade through bilateral talks with
Russia and Austria.
Certainly,
the budget for the year
2024-25 presented by Finance Minister Sitharaman is also a
budget to enrich the industries. Through this budget, unprecedented provisions
have been made to strengthen the manufacturing sector, reduce imports and
increase agricultural and commodity exports. It is important that the
manufacturing sector contributes significantly to both exports and employment
generation from the country and special care has been taken in this budget for
its promotion. In the budget, the Finance Minister has announced the
construction of plug and play industrial parks in 100 cities of the country.
Industrial parks with plug and play facilities will be developed with the
mutual participation of the Center, State and private sector. The entrepreneur
has to go to such an industrial park and start production. Under the provisions
of the new budget, development of industrial clusters or parks with plug and
play facilities in 100 cities can lead to large-scale production of at least 100 types of items. In the budget
for the year 2024-25,
the Finance Minister has empowered micro, small and medium enterprises (MSMEs)
with a view to increasing exports.
Undoubtedly,
the government will have to pay attention that till yesterday India's service
exports have been highlighted as a bright sector growing at a fast pace all
over the world, but now the pace of this effective service export of India has
slowed down. In such a situation, it is necessary to increase the pace of
service exports. The service sector has got a boost from the government's
Digital India Mission. It is important that the non-tariff barriers in front of
exporters, apart from duty, should be removed. So far, about
200 non-tariff barriers have been
identified. These are such barriers, which many countries create keeping in
mind their economic goals and foreign trade. These are generally unfair and
discriminatory to importers. These include documentation-related procedures,
seasonal duties, tariff quotas, testing and certification of goods, quality,
import restrictions, etc. These barriers are mainly related to marine products,
pharmaceuticals, minerals, etc. Governments of many countries, including China
and Russia, have been made aware of such barriers for the past several years.
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