India must diversify its exports of manufactured goods

The evolving geopolitical situation has opened up opportunities for us to boost exports

- AJIT RANADE

Indian data on the export of goods is reported more promptly than of services. This is because customs declaration and port formalities capture the data in real-time and a ready-to-use digital format. Data from GST payments on exports is also useful to triangulate and report quickly. In comparison, service exports need reconciliation from the banking system and Reserve Bank of India (RBI) before the final numbers can be confirmed. Besides, the delivery of services takes place over a longer time, as contract periods can run into years. Merchandise exports are clocked the moment goods leave the shore. There could be complexities such as pending receivable payments or the return of rejected items due to quality issues.

The holy grail is to get goods and services trade data in real-time and match it with the data reported by importing countries. India's goods export data for 2024-25 was recently released. Our aggregate export revenue of $437 billion is the same as last year; i.e., there was zero growth. This stagnation is puzzling because the impact of US President Donald Trump's tariffs won't show up until later. In calendar year 2024, total world trade grew 3.7%. Exports from South-east Asia grew 5.8% and from China by 5.4%. So, India's zero growth calls for introspection. This flat outcome was on top of a fall of 3% in 2023-24. So, it constitutes two years of sluggish performance, even though two years ago, in 2022-23, India clocked its highest-ever export value of $450 billion.