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April 25, 2024

Government Initiates Strategic Infrastructure Planning to Achieve $1 Trillion Exports by 2030

The Commerce Ministry is taking proactive steps towards achieving the ambitious goal of $1 trillion in merchandise exports by 2030 by embarking on an infrastructure development journey. A senior government official revealed that the ministry has begun an exercise to identify the necessary infrastructure requirements, potential sectors, and clusters crucial for reaching this milestone.

Additional Secretary in the Department of Commerce, Anant Swarup, disclosed that the Asian Development Bank (ADB) has been enlisted to conduct a comprehensive study in this regard. Swarup highlighted the importance of understanding the sectors and clusters that will contribute to the $1 trillion export target, emphasizing the need for a baseline study to identify existing gaps in infrastructure capabilities.

Speaking at a CII conference on resilient export logistics for trade and connectivity, Swarup stressed the significance of knowing the origins and destinations of exports and imports, as it forms the basis for infrastructure planning. He pointed out that with the target of $1 trillion exports by 2030, imports are expected to reach around $1.5 trillion, necessitating sufficient capacity to cater to a total EXIM trade of $2.5 trillion.

India’s merchandise exports faced a slight decline of 3.11% to $437 billion in the fiscal year 2023-24, while imports also dipped to $677.24 billion. Swarup underscored the importance of enhancing India’s integration into global supply chains (GVCs), which currently facilitate around 70% of global trade. He emphasized the need for increased manufacturing to leverage these chains effectively.

Echoing Swarup’s sentiments, Director General of Foreign Trade (DGFT) Santosh Kumar Sarangi emphasized the need for further infrastructure development at ports and airports to boost India’s exports. Sarangi outlined the magnitude of the challenge, indicating that India needs to augment its infrastructure to handle $2.5 trillion of exports and imports by 2030.

According to Sarangi’s estimates, significant infrastructure expansion is required across various sectors. This includes enhancing port capacity to support an additional 2,000 million tonnes of goods movement, increasing railway infrastructure to accommodate an extra 338 million tonnes of goods, and expanding airport facilities for the movement of 5 million tonnes of goods.

Sarangi also highlighted the immense potential for increasing exports through e-commerce. He noted that while global cross-border e-commerce trade reached $800 billion last year, it is projected to soar to $2 trillion by 2030. India, therefore, needs to realign its policies to foster an e-commerce ecosystem conducive to higher export volumes.

The current scenario underscores the necessity for robust infrastructure development to support India’s ambitious export targets. By strategically investing in infrastructure, enhancing manufacturing capabilities, and leveraging emerging opportunities in e-commerce, India can pave the way for sustained economic growth and global competitiveness in the coming years.

Jhumpa Lahiri

Jhumpa Lahiri

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