India’s Share in World Exports

India’s contribution to global exports has shown steady improvement over the past few decades, reflecting the nation’s expanding economic capabilities and growing participation in international trade. Despite its significant progress, India’s share in world exports remains modest compared to major global exporters such as China, the United States, and Germany.

Overview and Current Share

India’s share in global exports of goods and services is estimated at around 2.5 to 2.6 per cent in recent years. For merchandise exports alone, the share remains approximately 2.2 per cent of total world exports, while services exports—particularly in the fields of information technology, consulting, and business process outsourcing—contribute a higher global presence. The total value of India’s exports accounts for nearly 22 per cent of its Gross Domestic Product (GDP), reflecting the growing importance of the external sector in the national economy.
This performance places India among the top fifteen exporters in the world, though it still trails behind major trading economies. The gradual rise in export share over the past three decades illustrates an ongoing process of industrial diversification and policy reforms aimed at strengthening global trade competitiveness.

Historical Evolution

In the early 1990s, India’s share in world exports was below 1 per cent, a reflection of its relatively closed economy and limited industrial base at that time. Economic liberalisation initiated in 1991 marked a turning point. The subsequent decades witnessed a steady rise in exports driven by expanding manufacturing sectors, the growth of software services, and increasing foreign investment.
By the 2000s, the country’s exports gained further momentum due to the global demand for IT-enabled services, pharmaceuticals, textiles, and engineering goods. The 2010s saw diversification into new markets in Asia, Africa, and Latin America, supported by government initiatives such as the Make in India campaign and the expansion of special economic zones (SEZs). Despite global uncertainties, India’s export growth trajectory remained positive, resulting in a near doubling of its global export share since 1990.

Composition and Major Export Sectors

India’s export basket is a blend of merchandise and services.

• Merchandise exports include petroleum products, gems and jewellery, engineering goods, chemicals, textiles, and agricultural commodities such as rice, spices, and tea.
• Services exports are dominated by information technology (IT) and IT-enabled services (ITES), accounting for a substantial share of total foreign exchange earnings. Other services such as finance, healthcare, education, and consultancy are also expanding rapidly.

India has emerged as a global leader in software and business services exports, consistently ranking among the top exporters in the world in this segment. The export-oriented pharmaceutical industry and the automobile sector have also demonstrated significant potential, contributing to India’s trade diversification.

Comparative Global Standing

While India’s export base continues to expand, its share remains relatively low in comparison to the world’s largest exporters. China, for instance, accounts for nearly 17 per cent of global merchandise exports, while the United States and Germany each hold a substantially larger share than India. This disparity underscores the need for continued industrial expansion and improved competitiveness in international markets.
Nevertheless, India’s growth trajectory has been encouraging. The nation’s large population, skilled workforce, and technological capabilities provide a strong foundation for scaling up exports, particularly in high-value sectors such as electronics, renewable energy, defence equipment, and pharmaceuticals.

Determinants of Export Performance

Several factors influence India’s share in global exports:

• Infrastructure and logistics: Improvements in ports, transportation, and digital infrastructure are essential for reducing costs and enhancing global competitiveness.
• Trade policy and reforms: Initiatives such as the Production Linked Incentive (PLI) scheme, export credit support, and free trade agreements play a crucial role in expanding market access.
• Exchange rate and fiscal stability: A stable macroeconomic environment promotes investor confidence and enhances export potential.
• Integration into global value chains: Deeper integration with global supply chains, particularly in manufacturing, can significantly increase export volumes.
• Innovation and technology adoption: Strengthening research, development, and technological innovation in industries can help India move up the value chain and reduce reliance on low-margin products.

Challenges and Constraints

Despite significant progress, India’s exports face structural challenges:

• High logistics and transaction costs compared with global competitors.
• Limited penetration in high-technology manufacturing and value-added production.
• Trade imbalances with major partners such as China and the European Union.
• Volatility in global commodity prices affecting export revenues.
• Tariff and non-tariff barriers in developed markets.

Addressing these issues is essential for sustaining export growth and improving India’s global trade standing.

Future Prospects and Policy Outlook

India’s export strategy increasingly focuses on diversification and value addition. The government’s policies aim to promote manufacturing competitiveness, digital trade facilitation, and market expansion through bilateral and multilateral agreements. Sectors such as electronics, renewable energy equipment, defence manufacturing, and healthcare are expected to drive future export growth.
Regional initiatives such as the Act East Policy and participation in frameworks like the Indo-Pacific Economic Initiative are also creating new opportunities for trade expansion. Furthermore, efforts to simplify customs procedures, strengthen port infrastructure, and promote sustainability in exports are expected to enhance India’s global image as a reliable trading partner.