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India’s exports in 2023-24 will be more than that achievement of last year’s $776 billion, despite fall in commodity prices and loss of exports worth about $20 billion due to restrictions on exports of certain commodities, the Union Minister for Commerce and Industry, Piyush Goyal, said here today.
In an interaction with the media, Goyal observed that India’s exports had grown 55 per cent in two years, from around $500 billion to $776 billion. He disagreed that the 55 per cent growth was due to the base effect caused by depressed exports during the Covid-19 years, pointing out that in the previous ten years or so, India’s exports were around $400-500 billion.
He said that “such scorching growth” cannot be sustained, especially when the domestic demand was “so huge”. You can only export when you have an export surplus, the minister said. To illustrate, he made that point that the Indian steel industry had told him that they had no exportable surplus because there was such a big demand in India.
“In terms of foreign trade, we are doing very well,” he said.
On CBAM
On the Carbon Border Adjustment Mechanism (CBAM), Goyal said that it would hurt the European economy, making all goods expensive. Prices of commodities such as cement, steel and aluminium would go up, and therefore, infrastructure costs would go up, he observed. Asked if the Europeans were not aware of this, the minister said that the EU was aware of the consequences of CBAM, but was under “political pressure from some States”.
Asked if he thought EU would not bring in CBAM, Goyal said, “if they are smart, they will not bring it in, but if they get stuck in political compulsions, they will hurt their economy.”
He said that India would not be affected much because “we don’t export cement; our local demand for steel is so much that our steel exports to Europe are not that significant; we do not export aluminium, we only import fertilizers.”
Asked if India’s engineering goods exports to Europe would be affected, he said that in engineering goods,” the element of CBAM is very miniscule.” He said that India’s engineering goods exports were less worried about CBAM and more about the “headache of paperwork.”
He, however, said that India, like many other countries, would retaliate (impose higher duties on goods imported from Europe.)
The minister said that while negotiations with EU and the UK for Free Trade Agreements were going on, more countries (including Russia) were expressing interest in having free trade agreements with India.
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