There has been paradigm shift in India’s Exports and Imports pattern from Developed countries of USA and Europe towards the developing markets. The main reason for this shift is slowdown or recession in the USA and European markets.
India’s share of imports from European countries fell to 17.32% in 2012-13. This share earlier stood at 19.32% in 2009-10, and the same is true for the share of India’s Import from the US which has decreased to 4.94% from 5.89% earlier, according to Export Import Data India. India’s exports of Goods have decreased by 1.76% in 2012-13 to around $301 billion, while its imports grew by 0.44% to $491 billion.
Indian imports from the US for electronic items has seen an increase of around USD 2.1 billion in FY 2012-13, on the other hand its imports of machinery and equipments has declined, which resulted in overall decline in the share of imports from US. The maximum benefit of this shift in Import pattern of India has been taken by China which commands a significant share in India’s Imports currently. There has been significant increase in China’s share in India’s import for transport equipment, iron and steel and in fertilizer in year 2012-13 over 2009-10.
The main reason for the shift in India’s imports is due to restructuring in global production facilities due to which supply chains have been moving eastward. Even the share of countries like South Africa & Australia in India’s import is falling because India is sourcing most of its demand for gold from Switzerland.
Share of Indian Import from countries such as Kuwait, Qatar, Venezuela and Nigeria has gone up because it is importing petroleum products from these countries which it was earlier sourcing from Iran.( Due to the sanctions imposed by the US.)
Indian Imports from Japan have gone up mainly owing to its demand for transport equipment, machinery, Iron & steel products. Share of Import of Vegetable Oils have been increased with Malaysia which was hitherto dominated by Indonesia. With the decrease in demand for electronic items from Singapore and S. Korea, their share has also taken a hit.