India may not achieve the ambitious target of doubling exports of goods and services to $900 billion by fiscal 2020 from $470 billion in fiscal 2015, according to a research report by Crisil.

While the current global cyclical slowdown and the new Trans Pacific Partnership are casting a long shadow, the bigger challenge is structural, the report says.

"Falling trade intensity of global growth is the external structural constraint, while declining competitiveness, infrastructural bottlenecks and labour market rigidity are domestic," Crisil Research said, adding that apart from investing massively in vocational ecosystems that generate a large number of skilled workers, India also needs to quickly develop its infrastructure if it has to attract foreign investment and become a world-class exporting hub.

Dharmakirti Joshi, Chief Economist, Crisil, said, “Not doing so could upend the government’s flagship ‘Make in India’ programme, which aims to generate large-scale manufacturing employment.”

Merchandise exports, which are almost two-thirds of India’s total exports, have been declining in the last eleven months. Cumulatively, they have fallen 17.6 per cent in dollar terms in the first seven months of this fiscal, after seeing a 1.5 per cent decline in fiscal 2015.

Even real exports of goods and services (adjusted for price changes) shrank by 6.5 per cent in the first quarter of fiscal 2016. Trade openness, or the proportion of trade to GDP, has shrunk drastically – from a high of 55.6 per cent in fiscal 2013 to 47.1 per cent in fiscal 2015 and further to 42.6 per cent in the first quarter of the current fiscal.

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