India’s diversified export basket driving overall growth

India’s export basket has diversified over the last five years into high-value electronics, engineering goods and petroleum products, with the total value of the country’s exports surging by close to 40 per cent — from $314 billion in 2019-20 to $437 billion in the financial year ended on March 31, 2024.

“Both the qualitative change in favour of high value export goods and the robust growth reflect the strong fundamentals of the economy,” a senior official said.

India exported electronics goods worth $29.12 billion in 2023-24 which shot up by 24 per cent over the previous year. According to commerce ministry officials, the top five export market of electronics good are the US, UAE, the Netherlands, the United Kingdom and Italy which reflects the highly competitive nature of Indian exports.

Figures compiled by the Commerce Ministry show that exports of electronic goods such as smartphones, jumped by 151 per cent to $29.1 billion since FY20 constituting a 7 per cent share in total exports for 2023-24.

With companies such as Apple expanding operations to manufacture iPhones and US tech giant Micron set start production of chips at its semiconductor plant in Gujarat in early 2025, this share is expected to go up. The chips will be used in data centres, smartphones, notebooks, Internet-of-things devices and the automotive segments.

Similarly, exports of petroleum products grew by 109 per cent during this five-year period to touch $80.4 billion and now account for a 19 per cent share in total exports.

The exports of engineering goods shot up by 39 per cent to $109.2 billion accounting for a 25 per cent share in the total while pharma exports surged 35 per cent to $27.8 billion.

Defence exports have also emerged as a new segment of exports with India’s outgoing shipments of military hardware recording a 78% jump to Rs 6,915 crore in the April-June quarter of the current financial year (2024-25) from Rs.3,885 crore in the same quarter of 2023-24 reflecting the continuing growth in the defence sector as the country marches towards the Atmanirbhar Bharat goal.

According to the Economic Survey 2023-24, tabled in Parliament on July 22, India recorded its highest-ever defence exports, totalling $2.5 billion (Rs.20,915 crore) in FY 2023-24. This marks a 25% increase from $2 billion in FY 2022-23, reflecting a consistent upward trajectory over recent years. There has been a 131 per cent in defence exports since FY20.

Defence Minister Rajnath Singh has stated that the country’s exports of military hardware will touch Rs 50,000 crore by 2029-30.

A senior commerce ministry official said that this progress is driven by the success of strategic initiatives, such as the Make in India movement and Atmanirbhar Bharat; production reforms, such as the PLI scheme; and a consistent focus on export-oriented measures.

,(With inputs from IANS)