Why in news?
NITI Aayog released its Trade Watch report for the fourth quarter of financial year 2024–25. The report analyses India’s export and import trends and offers insights for policymakers and businesses.
Highlights of the report
- Total trade value: India’s total merchandise trade (exports plus imports) for Q4 FY25 was around US $441 billion. For the full financial year, trade reached about US $1.73 trillion.
- Export trends: Goods exports remained resilient despite global headwinds. North America emerged as the largest regional market. Service exports reached a record US $387.5 billion in FY25, driven by IT services.
- Import patterns: Imports of crude oil and gold remained high. The United Arab Emirates overtook Russia as a major source of imports. Electronics and machinery imports rose with domestic demand.
- Leather and footwear sector: The report highlighted the sector’s potential. It employs around 4.4 million people, many from socially disadvantaged groups. Despite strong domestic resources, India’s share in the global export market remains low due to high tariffs and limited product diversification.
Policy recommendations
- Diversify export destinations and products to reduce dependence on a few markets.
- Strengthen micro, small and medium enterprises (MSMEs) through access to finance, technology upgrades and skill development.
- Align manufacturing with global quality and sustainability standards to boost competitiveness.
- Reduce import duties on inputs in labour‑intensive sectors like leather and footwear to enhance exports.