International trade barriers are slowly narrowing down and a new era of world trade is emerging global economy export and import trade will play a major role since interdependence between economics on several aspects is increasing (Nelson, 2000; Rai, 2007). But interdependence on trade and development aid between countries is viewed with caution by most developing countries as they believe that developed countries are always motivated to sustain their interests and under such situation interests of developing countries may get partly neglected. India being a developed country has to protect its national interests of development and therefore export import trade policy has to be designed and implemented accordingly. In the export and import policy approach of government towards various types of exports and imports is conveyed to different exporters and importers. Export import policy regulates exports and imports of a country. Buying goods and services from other countries is known as import while selling services and goods countries is known as export. Nowadays in the globalization era, no frugality in the world can retain shortcut from the remaining globe. In the economic development of all developing and developed economies import and export plays an important role.
India’s foreign trade policy has been followed by controls and regulations on import and export to protect domestic industry and trade. To protect domestic industry and trade from foreign goods high import duty has been levied on imported goods and again imports were regulated and controlled through license and import substitution production measures (Capela, 2008). Despite all the controls and regulations and import substitution measures India’s foreign trade deficit has been increasing and it reached at alarming heights during late 1980s when India resorted to large scale borrowing from international financial institutions to settle trade deficit crisis. The below table shows the value of exports and imports from India:
Table 1: Value of Exports and Imports from India
Source: Mohanan (1995), Globalization of economy: vision of the future, Gyan Publishing House, New Delhi
To regulate import and export in the desired direction it is very essential that governmental frames some rules and regulations for exports and imports. A developing country like India has to import capital goods, modern technology and other essential items. For making payments of these essential imports, exports have to be promoted so as to maintain balance between exports and imports (Levy, 2005). If imports are more than exports, then need for foreign debt will rise which is not desirable. For boosting exports government gives various incentives to exporters by offering export promotion schemes.
- Nelson C A (2000), Import/export: how to get started in international trade, Tata McGraw Hill, USA.
- Rai U K (2007), Export-import and Logistics Management, PHI Learning Private Limited, New Delhi.
- Capela J J (2008), Import/Export for Dummies, John Wiley & Sons Publishing, USA.
- Levy D C (2005), To export progress: the golden age of university assistance in the Americas, Indiana University Press, USA