Signs indicate a resurgence in India's net exports as a key driver of economic growth. After a contraction in 2023-24, outbound shipments are on the rise in 2024-25, according to the latest monthly bulletin from the Reserve Bank of India (RBI) released on Monday.
The report notes that, except for China, nine out of the top ten export destinations—representing around half of the total export value—are seeing increased demand.
India's export profile is shifting towards electronics and engineering products, while traditional exports like gems, jewellery, textiles, garments, leather goods, and marine products are becoming less competitive, the report highlights.
Business services, encompassing consulting, engineering, research and design, are emerging as a major component of India's export sector, outpacing the growth of software and IT services. These services include advertising, public relations, logistics, accounting, auditing, architectural, and legal services.
The growth in demand for specialized services and the integration of services into manufacturing are key factors driving this trend.
Global capability centers are playing a significant role in this export expansion, including advancements in business and knowledge process outsourcing, the report notes.
During April-July 2024, the total value of merchandise exports reached $144.12 billion, up from $138.39 billion in the same period of 2023, marking a 4.15 percent increase, according to Commerce Ministry data.
Exports of electronic goods, including smartphones, surged by 37.31 percent, rising from $2.04 billion in July 2023 to $2.81 billion in July 2024. Engineering goods exports grew by 3.66 percent, from $8.72 billion to $9.04 billion, and drugs and pharmaceuticals saw an 8.36 percent increase, reaching $2.31 billion during the same month.
The RBI report also highlights improvements in logistics, with advancements in port and shipping infrastructure. Port development is enhancing cargo handling capacity and connectivity, with RFID-based access controls boosting security and operational efficiency. Public-private partnerships are also contributing to growth.
Out of 166 projects initiated at major ports under the Sagarmala scheme, 90 have been completed, increasing capacity by over 230 million tonnes per annum. Incentives such as 100 percent foreign direct investment (FDI) and a 10-year tax holiday are further encouraging the development, maintenance, and operation of ports, the report adds.
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