India Foreign Trade Policy 2009-14

The long term policy objective for the Government is to

double Indias share in global trade by 2020.

By 2011, India has set a policy objective of achieving an

annual export growth of 15% with an annual export target
of US$ 200 billion and by 2014. double Indias exports of
goods and services

Focus Market Scheme & Focus Product Scheme - 26 new

markets have been added under focus market scheme.
These include 16 new markets in Latin America and 10 in
Asia Oceania. A large number of products included in the
Focus Product Scheme.

Enhanced market access - Comprehensive Economic

Partnership Agreement with South Korea, The Trade in
Goods Agreement with ASEAN and the Mercosur
Preferential Trade Agreement with Latin American
countries

World Economic Growth Prospects

Source
IMF

The Emerging Economies

E7 emerging economies: the BRIC

economies of Brazil, Russia, India and
China, plus Mexico, Indonesia and
Turkey.

By 2050, the E7 emerging economies

will be around 50% larger than the
current G7 (US, Japan, Germany, UK,
France, Italy and Canada)

China is expected to overtake the US as

the projected
largest economy
in around
2025 economies to 2050 is headed by
The
list of fastest
growing
Vietnam, and the top 10 includes Nigeria, Philippines, Egypt and
Bangladesh

India has the potential to catch up with the US by 2050

Sources: Price Waterhouse Coopers, Goldman Sachs, The Times of India

Defying the Slowdown

India continued to grow even during

slowdown

Emerging economies recovered faster than

the developed economies

As the global economy recovers India and

China will lead the expansion and will grow at
rates of 5.4 and 8.5 % respectively.

Boosted by large policy stimulus that is

increasing demand from domestic sources
and a turn in the global manufacturing cycle,
the two Asian giants are leading the rebound
in emerging and other developing
economies
Source
World

Bank

Defying the Slowdown

Despite slowdown, India ranked among top five investors

destination for the next two years according to UNCTAD

India to attract major investments in Power Projects, Highway

Projects, Petroleum, Telecom, Auto and Chemical sectors

Financial Year : April - March

Source RBI

India Trade Agreements

Free Trade Agreement (FTA)

Srilanka
Thailand
ASEAN
EU (under negotiation)
Switzerland (under negotiation)
New Zealand (under negotiation)

Trade Agreements
Bangladesh
Bhutan
Maldives
China
Japan
Mongolia
Trade Treaty
Nepal
Comprehensive Economic Partnership Agreement (CEPA) - South Korea
Singapore

India Trade Agreements

Framework Agreement
GCC states i.e. The Member States of the
Cooperation Council for the Arab States of the Gulf.
ASEAN i.e. The Association of South East Asian
Nations.
Chile.

Regional Agreement
South Asia Free Trade Agreement (SAFTA) with
Pakistan, Nepal, Sri Lanka, Bangladesh, Bhutan and
the Maldives.

Preferential Trade Agreement (PTA)

Afghanistan
Chile
MERCOSUR - It is a trading bloc in Latin America
comprising Brazil, Argentina, Uruguay and
Paraguay. It has Chile and Bolivia as its associate
members.

Look East

In a major success in its `Look East' policy, India

has signed a Free Trade Agreement (FTA) with the
10-member Association of South East Asian
Nation (ASEAN) bloc that would eventually
eliminate duty on 80% of the goods traded at
present.

The two sides have set an ambitious target of

achieving an increase of $50 billion worth of trade
in the first year after the agreement comes into
force from January 2010.

Indian exporters of Machinery and machine parts,

Steel and steel products, agriculture products
such as Oilcake, Wheat and Buffalo Meat, Auto
Components, Chemicals and Synthetic Textiles
would gain additional market access as a result of
tariff liberalisation by ASEAN.

ASEAN member countries: Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia,

Myanmar, Philippines, Singapore, Thailand, Vietnam

Look East

India and South Korea has signed the

Comprehensive Economic Partnership
Agreement (CEPA)

The pact expected to boost bi-lateral trade

by $ 3.3 billion annually

Tariffs on South Korea auto parts are to be

reduced to one percent over a period of eight
years from the current average of 12.5 %

The Dragon-Elephant Tango

India China trade to cross $60 billion this year
By 2013-14 expected to cross $100 billion

The Dragon-Elephant Tango

India and China Billion plus

population. Together
accounting for 35% of world
population

300 years ago India & China

formed 50% of world GDP

Today it stands at 17%

% share in world trade is less

than 10%

India Exports

Data Source: DGCIS, Kolkata

India Imports

Data Source: DGCIS, Kolkata

Infrastructure Growth in India

SPLITTING

Bulk Cargo Handled During 2008

43%
57%
64893
110
2500
57039
55756
35128
36019
15810
21480

000 Tons

Kandla
Kolkata Dock System
Haldia

Mundra

Pipavav
Paradip
MBPT
JNPT
Gangavaram Visakhapatnam
Kakinada
Mormugao
Krishnapatnam
New Mangalore
Cochin

Chennai
Tuticorin

16662
8209

57282
42438
64597
2626
57154

Containers Handled During 2008

28%
000 TEUs
72%

137
717
179
3945
25
260
440

Kandla

Kolkata Dock System

Haldia

Mundra
Pipavav

Paradip

JNPT

Visakhapatnam

449

2
87

Mormugao
New Mangalore
Cochin

Chennai
Tuticorin

1140

Ports = Gateway or Funnel ?

More than 70% of
Container movement
through two gateways

Kandla

Kolkata Dock System

Haldia

Mundra
Pipavav
JNPT
Mormugao
New Mangalore
Cochin

Back end
infrastructure unable
to support the growing
infrastructure

Visakhapatnam
Chennai

Gateways tuned to
funnels

Tuticorin

Solution lies in de-hubbing congested ports and use

alternate efficient gateways

DISCOVERING

Development of the Notified SEZs

Back to Barter
CASE: India exports Iron Ore to China and Imports Coal from China

Iron Ore
Coal

Boxvantage

Ultra Large Container Vessels

of over 12000 TEU carrying
capacity (Emma Maersk, MSC
Daniella) are deployed on the
major trunk routes.
The next order vessels (8000
TEU) have to find employment
on the minor trunk routes

Two Way cargo movement

between India and China

Large volumes move in bulk

vessels

During a 24 hr operation in a
Indian Port, an average of
20000 tons discharged / loaded
in bulk operation using two
cranes
During the same period, 24000
tons can be loaded / discharged
in container operations using
same number of cranes

Evacuation of bulk cargo

takes days
Goods rail run at 40Kmph

Evacuation takes hours with

containers
Container trains run a
100Kmph

Back to Barter
The concept can be extended
to all commodities traded
between any pair of countries

Intra- Asia has over 160

Free Trade Agreements

Free Pollution to Pollution Free

Need of the Hour

on the East Coast of India

Ports with deep harbour to accommodate bigger vessels
Ports closer to the growing action area
Ports with efficient handling systems including dedicated
container berths
Ports that can cater to faster evacuation of cargo

Un-congested
Ability to expedite large volumes of cargo
Rail and Road links to hinterland
Capable to expand with growing needs

Regional Hubbing Kolkata , Chittagong, Yangoon, Renong,

Andaman, Chennai, Vizag

Visakhapatnam

In the middle of the fastest developing region in India.

Efficient container handling infrastructure

Ample space and un-congested

Deepest container terminal on the East Coast of India

Possibility for further expansions

Well connected to central, eastern, and southern India both by road and rail

Feasible to cater to 5 ICDs across India and Nepal

Proximity to the straits of Malacca

Limited ICD movement

Currently handling 0.08 million TEUs only

Manufacturing base still growing in the immediate hinterland

International Logistics Connection

to the Fast Emerging Market in
India

Summary
The nucleus of world trade shifting to Asia
Over 160 Free Trade Agreements in Inter-Asia region
India adopted Look East policy
East Coast is the center of action in India
Deep draft harbours with dedicated container terminals
within close proximity of the growing hinterland is the need
of the hour
Solution lies in directional distribution and regional hubbing
We need to grow pollution free