Competitiveness in Indian Agricultural Exports

Abstract

In this paper, an attempt has been made to decompose growth of India's agricultural exports four components a global component (GLOBO) indicating changes due to overall growth of world trade, a geographical component (GEO) indicating changes due to the country's distribution of trading partners, a product composition component (COMPO) indicating growth due to the mix of products exported, and a residual term indicating changes in competitiveness or performance (PERFO). The most used method, i.e, Shift-Share Analysis is used to break down total change of economic indicators into various components to identify underlying sources of growth or decline. This paper analyzes the change in shares of India's agricultural exports for two time periods- 2003-2010 and 2011-2018. Our analysis suggests, a decline in competitive of agriculture export in the latter period. While several pro-active measures have been taken by the Govt, to increase agriculture export, the most fundamental challenge lies in increasing competitiveness in this sector. Competitiveness in agricultural export is further dependent on both endogenous factors, like, geographic location, government policies etc and some are exogenous factors, like quality of produce, standardization etc. It is essential that the first and foremost focus of the government should be to address all factors that enhance competitiveness of agriculture export.