India needs to rapidly expand its exports to boost economic growth to levels of 8-10 per cent, economic adviser to finance ministry Arvind Subramanian has said.
His comments come after India's merchandise exports in January shrank for the 14th straight month on continued weak demand from Europe, its biggest market.
January exports fell 13.6 per cent from a year earlier, while imports dipped 11.01 per cent, data released by the commerce ministry last month showed.
India's exports declined 17.6 per cent year-on-year during the current financial year (April-January) and stood at $217.7 billion.
Imports during the period also declined by 15.5 per cent to $324.5 billion on the back of lower cost of petroleum oil and lubricants (POL) imports for the year so far.
India's trade deficit during 2015-16 (April-January) stood at $106.8 billion against $119.6 billion in the corresponding period of 2014-15, according to the Economic Survey 2015-16.
Obviously, India's free trade agreements that have doubled to about 42 since the mid-2000s, have only helped to increase its imports and has helped little to boost its exports
Increased trade has been more on the import than export side, because India maintains relatively high tariffs and hence had larger tariff reductions than its FTA partners.
However, in the case of the ASEAN FTA, the country has benefited on both sides of trade flows with a statistically significant 33 per cent increase in exports and 79 per cent increase in imports.