The commerce ministry is working on a plan to diversify export markets and products to lessen the country’s dependence on traditional trade partners such as the US and Europe and also to mitigate the risks of regional conflicts.
The government sees promising opportunities in countries such as Saudi Arabia, France and Vietnam for a wider range of goods, according to officials.
These goods include iron ore, engineering equipment, pharmaceuticals, electronics and processed foods.
This also aims to broaden the export basket beyond food staples to convenience foods such as ready-to-eat meals and value-added products such as jackfruit chips.
Previously on the periphery of the export map, regions such as Central Asia, Africa, and parts of the Americas are now contributing 5 per cent to exports.
The Red Sea crisis, which has disrupted traditional shipping routes, offered a unique challenge.
However, India has turned this adversity into an opportunity: by embracing longer routes via the Cape of Good Hope, new markets in Africa and the Americas have opened up for the exporters.
The officials said market research will be a critical element of the plan: the commerce ministry will identify the most suitable products for each targeted destination, considering factors such as market trends, competition and regulatory hurdles.
For instance, the government aims to push iron ore exports to France and Saudi Arabia, a significant departure from its usual markets dominated by China and Korea.
In engineering goods, the plan is to target markets such as Myanmar and Lithuania, while identifying established players such as Mexico and Japan as promising destinations.
Markets in Montenegro and Ethiopia are on the radar of the pharmaceutical companies, while Greece is viewed as a promising destination.
The new markets for electronics include Sao Tome and Mongolia, with Russia and Mexico categorised as promising markets. The US and UAE continue to be the mainstays.
In processed food, the government has identified Nigeria and Canada as it looks beyond established markets such as Brazil.
India’s trade deficit narrowed in March, but agricultural exports rose modestly. The ban on wheat, broken rice and non-basmati rice highlights the government’s focus on domestic food security.
Lifting the ban is crucial for agricultural exports. The recent end of the onion export ban with conditions suggests a shift towards a more balanced approach.
The trade deficit in 2023-24 is estimated at $78.12 billion, an improvement of 35.77 per cent compared with 2022-23 in $121.62 billion.
Reduction in imports is the primary factor behind the improvement in trade deficit, as exports remain stagnant with nominal changes.
While imports have fallen $43.21 billion from $898.01 billion in 2022-23 to $854.80 billion in 2023-24, exports have risen only $0.28 billion in the same period.