‘India has navigated uncertainty very well, exports may top $870bn’: Piyush Goyal | India News

Despite global challenges, commerce & industry minister Piyush Goyal expects exports to scale a new high this year, aided by FTAs. While remaining upbeat on growth, he tells Sidhartha that investment is flowing into several sectors. He is pushing for a review of FTAs with Asean and Japan and is cautious on China. Excerpts:How much export growth is expected this year given the global uncertainty?In the last 11 years of Modi govt, India has navigated uncertainty and volatility quite well. Total exports soared to a record $825 billion in 2024-25, growing over 6%, and sustaining a robust 5.8% CAGR over the past decade. We have seen a remarkable 20% CAGR during the past decade in electronics, and traditional sectors such as engineering and pharmaceuticals have done well. From 2019-20 to 2024-25, goods exports have seen a CAGR of 6.9%, despite the Covid period. From 2019 to 2023, because country-wise data is available up to 2023, commercial services exports registered a CAGR of 12%. Going forward, we may be able to maintain 5-6% growth in goods, especially non-petroleum exports, while services may grow 9-10%. If we can achieve that we are looking at crossing $870 billion in the current year, despite the global problems. Our focus is more and more on value-added and labour-intensive goods and services exports.How much help will come from FTAs?India has deepened its footprint with FTAs with the UAE, Australia, EFTA and the UK, reshaping our trade dynamics. FTAs do make an impact. With the UAE, services exports have almost doubled in the last four-five years. In Australia, it has nearly tripled. On the goods side too we have grown very well, in Australia’s case at 25%, we have crossed $8 billion, while we were tottering at $3 billion earlier. The same is not true of the ones signed during UPA. Services export to Japan is slowing down. We did not get very wide coverage in areas of interest for India. It’s a sad situation and I hope that our efforts for a review will bear fruit. Japan has not agreed to it and a South Korea review is underway. Now, we sign FTAs after extensive stakeholder consultation and for the Modi govt, national interest is paramount.The Modi govt opted out of RCEP. In hindsight, was it a sensible thing to do since many experts still argue that India should have joined it?Before the decision, we held 200 consultations with stakeholders on RCEP and the benefits of joining it, only three suggested we should join. PM Modi showed decisive leadership and sensitivities for our fishermen, farmers, industry and entrepreneurs. He recognised that it was nothing but FTA between India and China because we had agreements with the others. We have signed ECTA with Australia and we should be able to finalise an agreement with New Zealand in the next few months. Just this week at a meeting with exporters, the issue came up and not one of them suggested that we should join.The Asean FTA is under review. Are you satisfied with the pace or is there a sense of frustration?We can do much better and I am hopeful that both Korea and Asean will recognise the asymmetries in the FTAs signed 15 years ago and will make them more contemporary, fair, balanced and equitable.Your recent comments on the Asean agreement stirred a controversy. Do you see Chinese goods and investments getting routed through some of the countries that are part of the bloc?When the US announced its agreement with Vietnam, it focused on transshipment of goods from other countries. Every day we get cases of sub-standard goods coming in, predatory pricing being deployed for exports and to kill Indian industry. We are working on strengthening Make in India, supporting Indian industry wherever it is hurt by predaTOI tory pricing and focusing on Quality Control Orders.Does the focus on China+1 remain in the US?It appears to be working on a two-pronged strategy. While recognising that it cannot decouple completely from China, it is also working on strengthening the supply chain.Are there opportunities for India?Clearly, India is a much sought after destination for investments, there are collaborations for technology. In the maritime sector, India is recognised as a shipbuilding destination and govt is also coming up with measures to support it. Semiconductors is a success story of the Modi govt. We have seen significant increase in domestic value addition in the sectors where we offered PLI.Despite the focus on reducing imports from China, the trade deficit is near $100 billion. What is being done to check that?During the 10 years of UPA, India’s trade deficit with China grew nearly 25 times, but has expanded 1.75 times between 2014-15 and 202324. We have managed to bring some reasonable controls. Electrical equipment, machinery, organic chemicals and plastics are our major imports. Between 2019-20 and 2023-24, there has been an increase in import of these items from China, but there is also a corresponding increase in exports, showing that several items imported from China are raw material, inputs or capital goods used for making finished products in India.Is there a reluctance to allow Indian goods in China?There are several non-tariff barriers, including language and procedural delays. Many industries just don’t buy from India even when our products are competitive. Getting more market access is an area in which we are working with China through our embassy.Periodically, China has erected restrictions, whether it is export of rare earth magnets, fertilizer or tunnel boring machines, and recently recalled engineers. Yet, there are demands from Indian industry to lift some of the checks on investment from China, on visas and on apps.Given that there is now engagement with China at the ministerial level, if China is willing to engage on fair terms on trade, India will be willing to talks and see how we can work towards a more mutually beneficial and a fair trading system.Are the conditions conducive to lifting some of the checks?Time will tell.There are indications of a slowdown in the first quarter. As the minister in-charge of industry, what will be your strategy to accelerate growth in the industrial sector?We are already seeing an uptick and rural demand has shown significant improvement. You may see a jump in growth in the second half of the year. I see no difficulty in closing the year with RBI’s 6.5% growth which will make us the fastest growing economy.Weak capex by the private sector is a major concern. When do you see an improvement in investments?It varies across sectors. There is a lot of interest in investments in sectors that have domestic demand and there is import substitution, such as steel. There are plans to invest Rs 20 lakh crore in 10 years; cement is an ever-green sector as demand and production grow every year. Auto parts, sanitaryware are seeing large investments and there is confidence that Indian companies can compete with anyone. There are some focus areas like white goods, where demand is growing very fast on the back of tax cuts, growing income levels and the finance minister also spoke of GST reduction recently. Auto sector is growing rapidly and our efforts in electronics are showing results. Some of the investment going into GCCs may not be fully captured.While gross FDI inflows have grown, there was an increase in remittances and outward FDI last year. How will you step up overall FDI flows?With the outflow of investment, India is also building an asset base and its own presence in different sectors across the world, which in the long run will be our strength.What changes are you planning on SEZ regulations?There are certain suggestions that will help SEZ units increase their capacity utilisation and help meet the demand that is currently being serviced by some of the FTA countries. We are working with the requisite departments, and we should be able to come up with the changes by the end of the year.Quality control orders have been a focus. What is the rationale and benefit when a section of industry is objecting to them?We are emphasising on QCOs to implement the PM’s vision of zero defect-zero effect manufacturing. Technical regulations have been strengthened to promote a strong quality ecosystem in India, enhance product safety for consumers, prevent the import of substandard goods, protect the environment and attract investment. It acts as a nudge to produce quality products in India.How is the progress on industrial corridors and when will you be ready with the plan for 100 industrial parks?In Dholera, Shendra-Bidkin, Greater Noida and Vikram Udyogpuri, over 4,200 acres have been allotted and 76% of the developed industrial land is now under committed use. Each city is emerging as an industrial powerhouse: Dholera has emerged as the future semicon city of India, ShendraBidkin in Maharashtra is evolving into an automotive and EV hub. Of the 12 new projects approved by the govt last Aug, tenders have been floated and our target is to get the ground activity started by OctNov. As for the industrial parks, the blueprint is at an advanced stage. They are proposed to be developed and implemented through independent special purpose vehicles in collaboration between the Centre, states and wherever applicable, private players. There will be a single window system for approvals and plug-and-play infrastructure will be maintained.