India should improve ports, logistics to boost exports: World Bank

World Bank in its report has mentioned that India must take steps to improve ports and logistics and frame policies to reduce farm subsidies to emerge as an export powerhouse.
It was mentioned in the World Bank’s recently released report titled ‘South Asia’s Turn: Policies to Boost Competitiveness and Create the Next Export Powerhouse’.
The report has suggested a set of policy actions in four sectors — agribusiness, apparel, electronics and automotive.
What the report says?

  • India and the South Asia region can be Next Export Powerhouse by adopting the right set of productivity-enhancing policies.
  • It can triple its share in global markets of electronics and motor vehicles and double its already significant market share in apparel (excluding textiles and leather) by 2030.
  • India remains behind on ‘global value chain’ capabilities including physical capital, human capital, institutions and logistics.
  • Farm sector: Government needs to bring out reforms including reducing subsidies and promoting competition to enhance the business environment in the farm sector.
  • The passive and non-targeted subsidies have encouraged farmers to continue to produce low value crops using low productivity and unsustainable techniques.
  • Improved targeted subsidies will help to benefit the poor farmers. Targeted subsidies will encourage farmers to adopt new technologies and (seed) varieties.
  • Bedsides, restrictions on agricultural markets have constrained productive private investments in higher value food products.
  • Automotive sector: Government should gradually reduce tariffs on final cars, as the prevailing high import tariffs on the completely built units.
  • Electronics sector: It is faced constraints such as underdeveloped clusters and poor trade logistics. India needs to facilitate the development of clusters and improve its trade logistics to enable the seamless import and export of hundreds of components.”
  • Apparel sector: It is facing difficulties to import man-made fibre, preventing upgrading and diversification. India needs to reform the duty drawback scheme to facilitate the import of fabrics for exports.