Today, thirty-one year’s post economic liberalization, international trade continues to contribute approximately 30 percent of the Indian economy. The next thirty years are going to be critical, if not more, as the past thirty years in realizing India’s true potential. The next course of action for India’s economic development model is different and based on all three key dimensions – Exports. Technology. Governance. While aiming for tangential growth in this dynamic, uncertain and complex environment remains a disquieting challenge, it is utmost critical to ensure that growth is not just sustainable but also equitable and balanced. To take big strides towards making it a $5 trillion economy, it is imperative to focus on Made and Served by India and create a Self-Reliant India by growing cross border trade. The foundation for this will be strengthened by enhancing capability and productivity with metadata analytics and tech-disruptions. Moreover the need of the hour is to supplement this growth with supportive regulatory and policy frameworks to meet the evolving business requirements. It’s time India focuses on honing its strengths and showcase its capabilities at the global stage. While the average economic growth between 1970 and 1990 hovered at 4.3%, India’s GDP grew at a CAGR of 6.5% between 1990 and 2010, with the majority of contribution attributed to expansion of the service sector in exports. Hidden in these trends are global and local opportunities available as well as challenges that need to be addressed.
India has the 2nd largest base of MSMEs in the world, which contributes 45% total manufacturing, employs over 120 million and is responsible for 40% of India's total exports. Though India has made notable progress over the years in ease and cost of doing business, still a lot of MSMEs face challenges in entering new businesses and limits their market access. Lack of information makes the export-import processes tedious and slow for business. While leveraging newer technological and digital interventions to enhance productivity and production capabilities, there is scope of value creation when we bridge the perception, cost and quality of Indian exports which today are majorly composed of low value-added commodities, and a significant portion of the value accrues to countries processing these commodities and making finished products. How can concentrated efforts from the government, industry associations and firms fill this gap? A sector which employs 40% of the country’s population, India’s role in the global agri-commodity trading by establishing export hubs for farm, food, livestock, fisheries, horticulture, and dairy has to be enhanced. The sector can improve its productivity dramatically through technology and data enabled precision farming in addition to creating handling, storage, and processing infrastructure. Relative lack of formal education and training, capital and digitalisation are the initial bumps. The question to be asked is how can we consider increasing non-farm jobs in manufacturing and services at the required rate, while making jobs in agriculture more productive? One of the major impediments to export growth in India is the infrastructure sector with scope of improvement in the state of utilities, remote districts connectivity, export logistics, packaging and ICDs infrastructure. There is also an urgent need for skill empowerment and technology adoption to empower the grassroots with necessary intel to enhance their market access.
India is known for its diversity, richness of resources and unique skills. Each district has distinctive crafts, foods, commodities and services to offer to the world. The crux of Districts as Export Hubs Initiative is to nurture these gifts and create an ecosystem which incubates these products and services and places them on the world map. The Hon’ble PM’s clarion call of ‘Atmanirbhar’ to the nation in his address on the 74th independence Day unequivocally emphasised that we as a nation must move together on the path of value addition to our natural as well as human capital to achieve our true potential as a country. Districts as Export Hubs is a strategic initiative that can have a tremendous positive impact on the livelihood of millions of Indians if adopted and executed in a well-planned manner with rigorous support at the grassroots, which can only be ensured by channelised information gathering, persistent monitoring and sustained efforts. It is a call to action to the many stakeholders including the government, various institutions, business community and non-profit organizations but most importantly for each Indian as an individual. Harnessing the power of these change agents at the grassroots, and instilling a sense of enterprise and innovation, will boost motivations even of those situated in the remotest corners of India and those surviving at the bottom of the socio-economic ladder. Today technology has made convergence of India as one possible, overcoming all paradoxes and divides. Opportunity and recognition is available at anyone’s doorstep who has the will to learn, work and excel given we make accessibility and exposure to knowledge and capital readily available.
This initiative has encouraged the ‘synergy’ between the Center and State taking the competitive, cooperative federalism down to the district-levels. This new approach of invigorating districts to become the export hubs has infused ideas of decentralizing the planning process, and putting the local stakeholders at the focal point of the initiative. While the Centre has a growth mindset and proactive approach, a greater part of the transformation will have to be led by the states, and requires active participation by the business sector. Clear visibility of district export metrics, tracking of progress in a time-bound manner and concise delegation of responsibilities to all stakeholders involved will distinctly pave the way forward of the initiative. It is a collective commitment to developing long-term value creation, capabilities improvement, public private partnerships, and holistic corporate governance. Historically, the One Village One Product Movement in its various forms has been successfully implemented by multiple Southeast Asian countries. While the focus lay on product differentiation, a multitude of other elements like production and supply chain capabilities and costs, market access, price elasticity, product acceptance, quality government support and execution model played an important role in the success of the initiative. The end goal for all, like India, is economic development through financial, technical and marketing assistance. Most of the District and local authorities have positively responded to the District as an Export Hub Initiative and have come up with detailed District Export Action Plans, it is necessary to actively work towards removing the bottlenecks and developing an export hub ecosystem for the selected products. Making the plans and conducting discussions is just the tip of the ice-berg of the impending actions required to bring about radical changes on the ground. Continued efforts from the Centre and the State need to be supplemented with efforts of all the periphery ministries, departments, councils and local bodies to witness fast pace transformation in the regions both in economic and social front. There are also expectations of enhanced monetary support to this initiative in the upcoming Financial Budget.
Over the past, India has time and again shown resilience and outperformed by strategically enabling its economy. With the window for action narrowing, and the cost of inaction increasing, it is a necessity to unleash the untapped export potential of the nation, which eventually boosts the manufacturing and services capabilities, generates employment and ensures citizens’ welfare maximisation. It’s time for the creation of an outward looking economy by proactive encouragement of exports while addressing import reliance. To enhance grassroots contribution to India’s cross border trade and make all districts export hubs, India needs 21st Century Policy-making: imminent decisions based on data and analytics, real-world policy consensus by amalgamating perspectives of diversified stakeholders and the drive for design for change.
Views expressed above are the author’s own.
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