New Delhi: India must focus on expanding its export basket through innovations to maintain its current hold in global markets, explained Deepak Bagla, Mission Director at the Atal Innovation Mission (NITI Aayog) Friday.
The need for innovation is more acute in a changing global trading regime, which has been thoroughly impacted by tariffs imposed by United States President Donald Trump.
“In the last decade, there has not been any considerable change in [the kind of goods] our export basket. We have sustained our export markets. To maintain this requires us to keep changing that basket…There is going to be a change in how the export baskets function,” Bagla said at a policy dialogue organised at the Chintan Research Foundation (CRF).
“Export-led growth today is about exporting intelligence, not just goods. From services to semiconductors, India’s future lies in combining innovation with execution efficiency.”
Panellists include Kent Oliver Bhupati, adjunct faculty member at New York University; Akshay Mathur, Senior Director at the Asia Society Policy Institute in India; Soan Ray, visiting professor at the Indian Council for Research on International Economic Relations; and Pritam Banerjee, Head of Centre for World Trade Organisation Studies at the Centre for Research in International Trade. The session was moderated by Bidisha Bhattacharya, associate fellow at CRF.
The high policy dialogue was titled “Export-Led Growth: Unlocking India’s Trade Potential for Sustainable Development” and involved another panel discussion on sector-specific challenges in India’s export story, where Shishir Priyadarshi, President of CRF, gave the keynote address.
The common theme throughout the discussion was the lack of predictability in global markets. Bhupati highlighted that even during the COVID-19 pandemic, there was greater predictability within the markets than there is today.
Trump, since returning to office in January 2025, has sought to leverage the US economy and its advantages for his vision for a new trading regime. In April, he imposed several new tariffs, including reciprocal tariffs due to their trade surpluses with the US. The tariffs have been in effect since September.
India has been hit with 50 percent tariffs, partly due to its surplus and partly due to its continued purchase of Russian oil, which Trump recently sanctioned in a bid to pressure Moscow into ending its war on Ukraine.
Ray highlighted that the tariffs would impact the “labour-intensive sectors” of India’s economy, sectors like gems and jewellery production, shrimps and crustaceans, and textiles and garments. “Not that we are producing small amounts of goods. We are a manufacturing power, but it is mostly for the domestic markets.”
The visiting professor also highlighted areas to improve India’s export competitiveness through sectors like textiles.
Due to the high tariffs imposed by Trump, ties between the two countries have become frosty. India and the US have been locked in negotiations for a trade deal for almost nine months; there remain several issues in sectors such as agriculture, dairy, and poultry.
Akshay Mathur warned that a solution for the current impasse with the US needs to be found, given how “important” Washington is for the Indian economy. “Almost 40 per cent of all foreign portfolio investors in India’s capital markets are from the US…The US is a great source for Foreign Direct Investment (FDI).”
India has maintained that it is not bound by any timelines to conclude the deal with the US and that it would do so keeping in mind the protection of its sensitive sectors.
New Delhi has been able to strike successful trade deals with the United Kingdom, the European Free Trade Association, the United Arab Emirates and Australia. The agreements would see reductions in tariffs for almost 70-75 per cent of India’s export baskets, offering a more “stable” tariff regime for Indian exports, Pritam Banerjee, from CRIT, pointed out.
(Edited by Insha Jalil Waziri)
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