The Indian government has taken proactive steps to counter the decline in its agricultural exports, which fell by nearly 9 percent to $43.7 billion in the fiscal year from April to February, largely due to the lingering effects of the Red Sea crisis, disruptions from the ongoing Russia-Ukraine conflict, and several domestic restrictions. To address these challenges, the government is spearheading a new initiative aiming to enhance exports for 20 agricultural products which exhibit promising potential in the international market.
These products, which range from exotic fruits to raw commodities, include bananas, mangoes, potatoes, baby corn, fresh grapes, guava, pomegranate, watermelon, onion, green chili, capsicum, okra, garlic, groundnut, alcoholic beverages, cashew nut, buffalo meat, jaggery, and natural honey. Despite the broad array of items, India’s current footprint in the global export market has room to grow, from its present share of about 2.5 percent.
Rajesh Agarwal, Additional Secretary in the Ministry of Commerce and Industry, highlighted the nation’s goals during a briefing on Tuesday, “We have identified 20 products. At present, India’s share is low in global exports. We are working on detailed action for all these products. India’s share is about 2.5 percent in global exports, and the aim is to increase it to about 4-5 percent in the coming years.”
In 2022, the exports of these selected items amounted to $9.03 billion, while the global imports for the same commodities were valued at a staggering $405.24 billion. Currently, the leading markets for these goods include diverse economic regions such as the US, Malaysia, Canada, Russia, Germany, France, Korea, China, Indonesia, Japan, Italy, Belgium, and the UK.
In an effort to optimize logistics and improve export efficiency, the Agricultural & Processed Food Products Export Development Authority (APEDA) is collaborating with various institutions to devise sea transport protocols for products like ginger, pineapple, mangoes, and oranges, which are predominantly exported via air. APEDA Chairman Abhishek Dev elucidated the benefits of this development, noting that creating viable sea protocols could dramatically reduce logistics costs for horticultural produce bound for distant markets and subsequently lead to a significant uptick in the exports of fresh fruits and vegetables.
Official figures draw attention to the pressures facing India’s export sector, with a reduction observed in the shipment of 719 scheduled agri-products in the APEDA basket. These exports dipped by 6.85 percent to $22.4 billion during the 11-month window of the previous fiscal year compared to $24 billion in April-February of FY22-23.
Trade impediments such as export bans and restrictions on agricultural staples like rice, wheat, sugar, and onions further exacerbated losses in the agricultural export sector, amounting to an estimated $5-6 billion deficit in the last fiscal year. Notwithstanding these obstacles, there still appears to be a silver lining; out of 24 major commodities in the APEDA basket, 17 have showcased positive growth during this period, including fresh fruit, buffalo meat, processed vegetables, basmati rice, and bananas.
Notably, the export of basmati rice witnessed a remarkable 22 percent increase from $4.2 billion in the April-February timeframe of 2022-23 to $5.2 billion in the corresponding months of 2023-24, measured in terms of value.
Positioned at a critical juncture, India’s renewed strategy and concerted action plan to energize its agricultural exports could serve to stabilize the sector amidst global uncertainties. Through meticulous planning and strategic investments in both product development and shipping protocols, the government aspires to cultivate a stronger and more resilient agricultural economy with a larger share in the international market.
