{"id":142079,"date":"2021-10-20T18:50:32","date_gmt":"2021-10-20T13:20:32","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=142079"},"modified":"2021-10-22T18:16:30","modified_gmt":"2021-10-22T12:46:30","slug":"changing-economic-order","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/changing-economic-order\/","title":{"rendered":"Changing economic order"},"content":{"rendered":"\n

Synopsis<\/strong>: In the absence of a focused approach to exports in the changing global environment, longer-term growth prospects are bound to suffer.<\/p>\n

Introduction<\/strong><\/h5>\n

India is on track to attain the $400-billion export target this fiscal year. Exports jumped to $33.44 billion in September, registering 21.35% year-on-year growth. India is clearly benefiting from a stronger-than- expected recovery in international trade.<\/p>\n

But note that booming international trade may not sustain for long and the world is witnessing a trend of de-globalisation. Hence, India needs to adopt policies that could suit the changing global environment.<\/p>\n

Why it is said that the world is witnessing a deglobalisation phenomenon?<\/strong><\/h5>\n

International trade has been under pressure<\/strong> for several years and the pandemic has only exacerbated the fault lines.<\/p>\n

Large economies are reconsidering their dependence<\/strong> on international supplies and would aim to build domestic capacity.<\/p>\n

Corporations are also re-evaluating the resilience of supply chains.<\/strong> All this may affect global trade and growth over the medium term and hasten the trend of de-globalisation.<\/p>\n

The trade openness index,<\/strong> which was steadily rising in the post-war period, for instance, started declining after 2008 financial crisis.<\/p>\n

The growth of global value chains has stopped,<\/strong> and reforms are stalled all over the world according to an article on the de-globalisation trend last year by the Peterson Institute for International Economics.<\/p>\n

China, which has been a driving force for trade and growth in recent decades, started looking inward.<\/strong> Although it is still a dominant exporter, exports as a percentage of gross domestic product (GDP) have fallen from over 30 per cent in 2008 to under 20 per cent.<\/p>\n

Trade tension between the US and China<\/strong> during the Donald Trump years also contributed to the process. Strategic rivalry between the two and the evolving geo-political environment would continue to undermine economic openness.<\/p>\n

Institutions governing the global order<\/strong> are also under pressure.<\/p>\n

How India needs to prepare for the future?<\/strong><\/h5>\n

India should not get carried away by the current year\u2019s export numbers. India will not be able to attain higher sustainable growth without higher exports and policy-making should be guided by this basic economic reality.<\/p>\n

Need to review of the current trade policy<\/strong>. India has increased tariffs in recent years, which has direct implications for exports. According to the World Bank data, exports as a percentage of GDP have fallen from a high of 25% in 2013 to about 18% in 2020. This needs to be reversed.<\/p>\n

India needs to tap more global markets. <\/strong>Recently, India decided to stay away from the Regional Comprehensive Economic Partnership<\/strong>, which will affect longer-term trade prospects. India needs to reconsider such decision and it should negotiate better to get advantageous free trade pacts.<\/p>\n

Source<\/strong>: This post is based on the article \u201cChanging economic order<\/strong>\u201d published in Business standard <\/strong>on 20th October<\/strong> 2021.<\/p>\n","protected":false},"excerpt":{"rendered":"

Synopsis: In the absence of a focused approach to exports in the changing global environment, longer-term growth prospects are bound to suffer. Introduction India is on track to attain the $400-billion export target this fiscal year. Exports jumped to $33.44 billion in September, registering 21.35% year-on-year growth. India is clearly benefiting from a stronger-than- expected… Continue reading Changing economic order<\/span><\/a><\/p>\n","protected":false},"author":10316,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[8671,507,9218,216],"class_list":["post-142079","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-changes-in-industrial-policy","tag-economic-reforms","tag-exports-promotion","tag-gs-paper-3","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704950614},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/142079","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10316"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=142079"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/142079\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=142079"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=142079"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=142079"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}