Share of exports in GDP rises despite widening current account deficit

The share of merchandise exports as a percentage of the country's overall gross domestic product (GDP) has increased from 13.9 per cent in 2009-10 to 16.0 per cent in 2010-11 and further to 17.7 per cent in 2011-12 despite its increasing current account deficit (CAD).

India's share in total global merchandise exports has been almost static at 1.48 per cent during 2010, 1.66 per cent during 2011 and 1.60 per cent in 2012, commerce minister Anand Sharma said quoting WTO trade statistics.

Sharma said since the current account balance has a very close correlation with macroeconomic stability of a country, the government and policy makers are keeping a close watch on India's balance of trade and current account balance.

He said the government is focusing on an aggressive product promotion strategy for high value items that have a strong manufacturing base is the country.

''The core of the market strategy is to retain presence and market share in traditional markets, move up the value chain in providing export products in the developed country markets; and open up new vistas, both in terms of markets and new products in these new markets,'' Sharma informed the Lok Sabha in a written reply today.

Meanwhile, Sharma said, the meeting of the government-industry joint task force (GIJTF) and the Board of Trade at meetings held on 21 December 2012 and 22 March 2013, respectively, reviewed issues pertaining to the growth of manufacturing industry, including availability of raw material, power, infrastructure bottlenecks, cost of credit in a bid to push up manufacturing exports.

The Board of Trade (BoT) meeting reviewed issues relating to euro zone crisis, slowdown in exports, widening of trade deficit and measures required to boost exports. Keeping in view the financial and overall economic implications, some of the suggestions have also been incorporated in the annual supplement to the Foreign Trade Policy announced on 18 April, he added.