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Trade Policy Reforms in India
Geethanjali Nataraj NCAER, New Delhi For the ICRIER-SABER workshop, 29-30 June p, 2009, New Delhi.

Trade Policy in India
• Trade Reforms form the crux of the economic reforms in India. • Export Promotion has been and continues to be a major thrust of India’s trade policy • Accordingly, policies have been aimed at creating a friendly environment by eliminating redundant procedures, increasing transparency by simplifying the processes involved in the export sector and moving away from quantitative restrictions, thereby improving the competitiveness of Indian industry and g p reducing the anti-export bias. • Steps have also been taken to promote exports through g g multilateral and bilateral initiatives and giving several incentives to exports to cope with all uncertainties at the global level.

Features of Trade Policy Reform in India
• • • • • Free imports and Exports Rationalization of tariff structure/reducing tariffs Decanalisation Liberalization of the exchange rate regime. Setting up of trading houses, SEZ’s and Export houses SEZ s promotion industrial parks. • Various exemptions under the EXIM policies to boost exports and imports and make the trade policy regime transparent and less cumbersome. p

Towards a more open economy
1990 91 1990-91
Peak Import duties ( Manufactures ) Import Controls Trade goods)/GDP ratio ( %) Software exports ( & billion) Worker remittances ( $ billion) FDI ($ billion) g y Foreign currency reserves ($ billion) 200% plus Tight, Tight detailed 14.6 Nil 2.1 negligible 2.2 billion

2007 08 2007-08
12.5% Negligible 34% 25 billion 25 billion 23.2 billion 152 billion

Emergence of large developing countries in global trade
• Rise of India, China, Brazil and South Africa , , • Combined share of these countries in World GDP is more than 18 per cent World Merchandise exports is 12 per cent

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