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Wednesday, July 17, 2024

In the previous five years, India’s proportion of global exports in labor-intensive industries has decreased: FIEO

<p>According to a FIEO analysis, India’s labor-intensive export industries, including clothing, marine goods, plastics, gems, and jewelry, are displaying a “troubling pattern” as the nation has seen its worldwide market share drop over the last five years.<img decoding=”async” class=”alignnone wp-image-215071″ src=”https://www.theindiaprint.com/wp-content/uploads/2023/10/theindiaprint.com-in-the-previous-five-years-indias-proportion-of-global-exports-in-labor-intensive-.jpg” alt=”theindiaprint.com in the previous five years indias proportion of global exports in labor intensive” width=”1138″ height=”637″ srcset=”https://www.theindiaprint.com/wp-content/uploads/2023/10/theindiaprint.com-in-the-previous-five-years-indias-proportion-of-global-exports-in-labor-intensive-.jpg 300w, https://www.theindiaprint.com/wp-content/uploads/2023/10/theindiaprint.com-in-the-previous-five-years-indias-proportion-of-global-exports-in-labor-intensive–150×84.jpg 150w” sizes=”(max-width: 1138px) 100vw, 1138px” title=”In the previous five years, India's proportion of global exports in labor-intensive industries has decreased: FIEO 3″></p>
<p>A word of caution is advised about a noticeable increase in export growth of almost $40 billion, according to the apex exporters organization Federation of Indian Export Organizations (FIEO), since this increase is likely due to a rerouting of crude oil trade routes through India to Europe.</p>
<p>It warned that this tendency may not continue in the years to come.</p>
<p>The “poor” performance of labor-intensive industries is cited as the most “pressing concern” surrounding the negative export growth.</p>
<p>These industries are of utmost importance in a nation like India because of their ability to generate large numbers of new jobs as well as their significant contribution to net high-value addition.</p>
<p>“To solve this problem, a proactive strategy that investigates the fundamental causes of the loss of market share is needed. According to the research, this necessitates a thorough examination of all the factors at play, from quality and innovation to preserving a competitive edge and lowering manufacturing costs.</p>
<p>Speaking further about the need of encouraging traditional industries, FIEO said that the $10 billion in mobile phone exports had a net value addition of between $1 and $2 billion.</p>
<p>On the other hand, it noted, $10 billion in conventional sector exports would result in a net value increase of almost $9 billion.</p>
<p>“An analysis of sector-wise export performance for the last five years reveal the troubling pattern that India is experiencing a decline in global market share across labour-intensive sectors,” the organization said. It added that the apparel, knitted garment, marine products, plastics, gems, and jewelry sectors have raised concerns due to their modest growth rates ranging from 1% to 2%.</p>
<p>Notably, although India’s growth stayed at only 2%, the worldwide trade in knitted clothing increased by 6%.</p>
<p>Despite a worldwide trade growth rate of roughly 2%, India’s export growth in woven garments has continuously remained below 1% for years, while Bangladesh and Vietnam’s growth rates of 6% and 4%, respectively, have a negative influence on India’s share.</p>
<p>“The worldwide footwear market saw a 5% increase in trade, while India’s exports fell. India’s meager rise from about $2.8 billion to $3 billion contrasts with Bangladesh’s dazzling development from $1 billion to $1.7 billion over three years, it added.</p>
<p>It said that despite the aim, India’s growth has not kept pace with demand, languishing at 9% while the worldwide market increased by 12% over the previous four years. In a similar vein, India’s desire to lead the world in pharmacy also confronts obstacles.</p>
<p>Cough syrup-related criticism “raised concerns, highlighting the need for an effective trace and tracking system for quality assurance,” the statement said.</p>
<p>Furthermore, it said that research into industries powered by technology shows a sharp increase in demand for machinery, car parts, electrical items, and electronics products on a worldwide scale.</p>
<p>“These industries account for almost $7 trillion, or nearly one-third, of all commerce in the world. India now has a meager 1% of the market in these industries. It’s interesting to note that India imports a sizable amount of these products—roughly $100–120 billion annually,” it stated.</p>
<p>A more sophisticated analysis is necessary when it comes to labor-intensive industries, the paper said.</p>
<p>It is clear that market share has been gradually declining in these industries over time, and this decrease raises questions about India’s competitiveness and continued involvement in these traditional job-creating key categories, it added.</p>
<p>According to the report, it is also clear that South Korea and India have consistently shown negative growth rates in their exports over the past six months (January to June 2023), based on the export performances of the top six rival nations (India, Bangladesh, China, Vietnam, South Korea, Malaysia, and Indonesia).</p>
<p>China, Malaysia, and Indonesia, on the other hand, have had positive growth rates in two of the last six months.</p>
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