Akhila Hebbar- 109

Anshika Singh- 114

Arun Xavier - 118
Deepali Deore -142
Definition:
The difference between the value of export of goods and
the value of import of goods is defined as the Balance
of Trade(BoT)

When Value of exports > Value of Imports, then BoT is

said to be favourable

When Value of exports <Value of Imports, then BoT is

said to be unfavourable
Foreign Trade since Independence:
The First Plan Period (1951-52 to 1955-56):
Exports(Rs Crores) Imports (Rs Crores) BoT (Rs Crores)
622 730 - 108

Rise in imports due to:

Pent up demand of war
Shortage of food and Raw Material
Rise in capital goods

Trade Deficit largely due to programmes of

industrialisation
Foreign Trade since Independence:
The Second Plan Period (1956-57 to 1960-61):
Exports(Rs Crores) Imports (Rs Crores) BoT (Rs Crores)
613 1080 - 467

Massive Industrialisation Programme

Foodgrains imports had to be resorted to overcome
internal shortages and rising prices
Foreign Trade since Independence:
The Third Plan Period (1961-62 to 1965-66):
Exports(Rs Crores) Imports (Rs Crores) BoT (Rs Crores)
747 1224 - 477

Rapid Industrialisation
Increase of Defence Needs
Large Quantities of foodgrains imported
Foreign Trade since Independence:
The Fourth Plan Period (1966-67 to 1973-74):
Exports(Rs Crores) Imports (Rs Crores) BoT (Rs Crores)
1810 1973 - 163

India Devalued Rupee by 36.5% in 1966

Better Crop Production during 1968-69
Favourable BoT for the 1st time in 1972-73(+104 crore)
Foreign Trade since Independence:
The Fifth Plan Period (1974 to 79):
Exports(Rs Crores) Imports (Rs Crores) BoT (Rs Crores)
4728 5538 - 810

Hike in Oil Prices started in Oct 1973

High Import bills due to petroleum,fertilizers and
foodgrains
Significant improvement in Exports
2nd Favourable BoT in1976-77(+69 crore)
In 1978,Janata party followed a policy of haphazard import
liberalisation
Foreign Trade since Independence:
The Sixth & Seventh Plan Period (1980 to 1990):

Plan Period Exports Imports BoT (Rs Crores)

(Rs Crores) (Rs Crores)
1980-85 8967 14683 -5716
1986 -90 17382 25112 -7730

Increase in Price of Petroleum products by OPEC

Govt. approached IMF for a huge loan in Nov 1981
Then, a slight decline in POL because:
Global prices of oil ..downward trend
Increased Production by ONGC
Foreign Trade since Independence:
The Eight and Ninth Period (1980 to 1990):
Plan Period Exports Imports BoT (Rs Crores)
(Rs Crores) (Rs Crores)
1992-97 86557 97609 -11352
1997 -02 168400 204763 -36363

Liberalization Policy & Reduction of custom duties

Slowdown in Indias Foreign Trade due to
South East Asian Crisis
Continued recession in Japan
Economic crisis in Russia in 1998
Foreign Trade since Independence:
The Tenth Plan onwards
Plan Period Exports Imports BoT (Rs Crores)
(Rs Crores) (Rs Crores)

2002 - 03 255137 297206 -36363

2003 04 293637 359108 -65741

2004 05 375340 501065 -125725

2005 06 456418 660409 -203991

2006 07 571779 840506 -268727

2007 08 655864 1012312 -356448

2008 - 09 840752 1374435 -533683

2009 - 10 784268 1237707 -453439

Widening Trade Deficit
India underestimated the impact of South East Asian
Crisis
Increased Competition from China and Taiwan
Exports of Textiles affected
Failure of large industrial houses to boost exports
Non Tariff barriers created by developed countries
Use of Anti dumping duties by these countries have
affected exports
Composition of Indias Foreign trade
Pattern of Imports:

Import

Bulk Non Bulk

Petroleum Fertilizers, Iron &

Cereals,Pulses,etc Capital goods Export Items
Products Steel,etc
Composition of Indias Foreign trade
Structure of Indian Imports:
2000 01 (%) 2008 09(%)
1]Bulk Imports 95095 (41.2) 627486 (45.6)
A)Petroleum, Crude & Products 71497 (31) 419967 (30.6)
B)Bulk Consumption Goods 6593 (2.8) 22883 (1.6)
C)Other Bulk Items 17005 (7.4) 184635 (13.4)

2] Non Bulk Imports 135778 (58.8) 746949 (54.4)

A)Capital Goods 40847 (17.7) 330384 (24.1)
B)Mainly Export Related Items 36815 (15.9) 146860 (10.7)
C)Others 58116 (25.2) 269704 (19.6)

3] Total (1]+ 2]) 230873 (100) 1374435 (100)

All figures in Rs. Crores
Composition of Indias Foreign trade
Pattern of Exports:

Export

Agriculture
Ores and Manufactured Mineral fuels
and Allied
Minerals goods and lubricants
Products
Composition of Indias Foreign trade
Structure of Indian Exports:
1980 - 81(%) 2008 09(%)
1]Agriculture and Allied Products 2057 (30.6) 80648 (9.6)

2]Ores and Minerals 413 (6.2) 35877 (4.3)

3] Manufactured Goods 3747 (55.8) 566402 (67.4)

4]Petroleum Products & Mineral fuel 28 (0.4) 123397 (14.6)

5)Others 465 (6.9) 34428 (4.1)

6] Total 6710 (100) 840752 (100)

All figures in Rs. Crores
Exporting Countries
Importing Countries
Measures taken to Correct
Deficit
Devaluation
Cash Assistance
Income Tax Concessions
Import Concessions
Convertibility of the Rupee
Export- Import Bank
Challenges
External Factors:
Low World Demand
Restrictions on our goods entering foreign countries
Competition from countries like China

Internal Factors:
Increasing Domestic Demand
THANK YOU!!!