1.

Foreign Trade
*Types
*Benefits
*Limitations

2. Trends in India’s Foreign Trade

3. Impact of WTO on India’s Foreign Trade
*Positive Impact
*Negative Impact Asim G.M

Dhanuja

Bharath

Faheem Pasha
Foreign Trade
Foreign trade or International trade is exchange of goods
and services across international borders or territories.

According to Wasserman and Haltman, “International trade

consists of transactions between residents of different countries”.

According to Anatol Marad, “International trade is a trade

between nations”.
Types of Foreign Trade
 Export Trade

 Import Trade

Export Trade involves sale of goods and services to other

countries.

Import Trade involves purchase of goods and services from

other countries.
Benefits of Foreign Trade

Greater Variety of Goods Efficient Allocation and Better

Available for Consumption Utilization of Resources

Promotes Efficiency in
More Employment
Production

Consumption at Cheaper cost Reduces Trade Fluctuations

Utilization of Surplus Produce Fosters Peace and Goodwill

Limitations of Foreign Trade

Rapid Depletion of Exhaustible

Danger of Starvation
Natural Resources

One country Gains at the

Import and Harmful Goods
Expense of Other

It may Exhaust Resources May Lead to War

Over Specialization Language Diversity

Trends in India’s Foreign Trade
India’s export in 2013-2014
In the last five years, India’s export growth has seen ups
and downs, being in negative territory twice in 2009-2010 as an
after shock of the 2008 crisis.

In 2012-2013 as a result of Euro zone crisis and global

slow down, India’s export were U.S. $312.6 billion against a
target of U.S. $325 billion during 2013-2014.

They grew by a positive 4.1% as compared to the negative

growth of 1.8% during the previous year.
 India's Top Exports (U.S$, 2013-2014)

13% Gems & Jewelry

Transport
25%
Machinery
7%
Pharma
5% Meatl products
Fabric & Textiles
5% Electronics
Plastics
20% 3% Agri(Rice etc..)
7%
Petro Products
Others
10% 3%
2%
Trends in India’s Foreign Trade
India’s import in 2013-2014
Import growth decelerated sharply from 32.3 % in 2011-12
to 0.3 % in 2012-13 and fell to a negative -8.3 % in 2013-14,
Among the major items of import, the value of (POL) , which
constituted 36.7% of total imports in 2013-2014, grew
marginally by 0.7 %

The other major item of import is gold, the import of gold

declined from 1078 tonnes in 2011-2012 to 1037 tonnes in 2012-
2013 and further 664 tonnes in 2013-2014
 India's Top Imports(U.S $, 2013-2014)

7%
Electronics
6%
22% Gold
5% Jewelry Stones
Machinery
6% Chemicals & Plastic
Coal
4%
Transport Equipment
3% Ores
Edible Oil
3%
Crude
37% 3%
2% Others
World Trade Organization

The World Trade Organization (WTO) is an

organization that intends to supervise and liberalize international
trade. The organization officially commenced on 1 January 1995
under the Marrakech Agreement, replacing the General
Agreement on Tariffs and Trade (GATT), which commenced
in 1948.
Impact of WTO on India’s Foreign Trade
India is a founder member of WTO. There was much
heated discussion and arguments for and against regarding India
becoming a member of WTO. India is one of the 76
Governments that became members of the WTO on the first day
of the formation.

The main aim of India as a member of WTO is to achieve

stability and predictability in the governance of international
trade, India has bound 67% of its tariff lines in recent times, in
case of agricultural goods India’s bound rate ranges from 100-
300%
Positive Impact of WTO on India’s Foreign Trade

Boosts to Exports Security and Predictability

Policy Assistance Trade Links

Settlement of Disputes Special Concession

Promotion of Competition Technical Assistance

Sustainable Development Policy Review Mechanism

Negative Impact of WTO on India’s Foreign Trade

Prominence to Developed
No Export Push
Nations

Price Rise Danger to Services Sector

Not Really Free Trade Erosion of Autonomy

Tramples Labor and Human

Fundamentally Undemocratic
Rights

Increasing Inequality