Explanation –

• Narrowing Current Account Deficit (CAD): An increase in exports and a decrease in imports contribute to narrowing the current account deficit by improving the trade balance. This occurs because exports bring in foreign currency while imports require domestic currency, thus reducing the deficit in the balance of payments.
• Rise in Gross Domestic Product (GDP): The increase in exports reflects higher economic activity and production within the country, which can lead to a rise in GDP. Exports contribute positively to GDP growth by generating income and employment opportunities, stimulating investment, and enhancing overall economic performance.
• Appreciation of the Rupee: A rise in exports and a decrease in imports can lead to an appreciation of the domestic currency due to increased demand for it in international markets.

Source: The Hindu