India's foreign trade may cross $1.6 trillion in FY23

High trade figures underline emergence of trade as a key component of Indian economy, says a Global Trade Research Initiative report.

- NIVEDITA MUKHERJEE

Even as India charts a trajectory of US$1 trillion exports each of goods and services by 2030, India's foreign trade, including exports and imports of merchandise and services, is estimated to cross $1.6 trillion or 48% of India's nominal GDP of US$3.4 trillion for the fiscal year ending March 2023. Despite sectoral weaknesses, high trade figures underline emergence of trade as an important component of Indian economy, says a report by the Global Trade Research Initiative.

Government data on Thursday projected India's overall exports, combining goods and services, to scale new heights during FY 2022-23 (April-March) with a growth of 13.84% year-on-year to achieve a whopping US$770.18 billion worth of exports. Merchandise exports registered highest ever annual exports of US$447.46 billion with 6.03% growth during FY 2022-23 surpassing the previous fiscal exports of US$422.00 billion. The show stopper was services export, which catalysed the overall exports growth with a new record annual value of US$322.72 billion and growth of 26.79% over FY 2021-22.

As India's domestic demand has remained steady amidst the global slump, overall imports in FY 202223 (April-March) is estimated to exhibit a growth of 17.38% over FY 202122 (April-March). "Higher growth rate in services exports, compared to merchandise exports, has improved overall performance of India's exports," says Ajay Srivastava, Founder of GTRI, a technology and trade research group. A comparison of compounded annual growth rate (CAGR) for past 5 years (FY18 to FY23) show that services exports grew with a higher CAGR of 9.8%) than merchandise exports (7.5%), Srivastava opines.