Business Across Borders 2021

10 Introduction COVID-19 pandemic that has led to significant loss of human lives and also caused major disruption to the global economy. With around half of the global population being under some form of lockdown and international borders getting closed, global markets witnessed large scale supply-chain disruptions. This coupled with demand shock adversely impacted the international trade. As per the International Monetary Fund (IMF) estimates, global trade (both merchandise and services) witnessed a sharp contraction of 9.6% in 2020. While international trade in advanced economies declined by 10.1%, emerging market and developing economies witnessed comparatively less contraction of 8.9% during 2020. With global trade getting hit hard, India’s exports sector also suffered a huge setback. However, there were few silver linings in the dark clouds of this health and economic crisis. While exports of traditional segments like gems & jewellery, engineering goods and textiles were hampered, pharmaceutical and agriculture sectors emerged strong during this period. Apart from this, the COVID-19 pandemic led many global companies to think of realigning their supply chains strategies given the risks associated with a single-source supply-chain. This is likely to open a new opportunity for Indian exporters to showcase their potential. This section seeks to analyse India’s export sector’s performance during the pandemic and the initiatives that would help in boosting exports going forward. India’s exports during the pandemic Merchandise Exports India’s merchandise exports witnessed substantial decline during April-December FY21 because of global demand side shock and supply chain disruptions in India as well as international markets, consequent to rising cases of COVID-19 and lockdowns. The merchandise exports plunged by almost 15.8% (in USD terms) on-year during April-December FY21. However, with the unlocking of the domestic economy from June onwards, India’s exports witnessed gradual revival. India’s exports witnessed gradual revival post June 2020 10 26 0 5 10 15 20 25 30 35 January February March Apr il May June July August September October November December US$ bn 2020 2019 Source: Ministry of Commerce Overview – Business Across Borders Dun & Bradstreet