India’s agricultural trade surplus has thus reduced from $10.6 billion in April-December 2023-24 to $8.2 billion for the corresponding nine months of the current fiscal (April-March)

Recent Trends in Agricultural Exports

• India’s agricultural exports grew by 6.5% from $35.2 billion (April-December 2023) to $37.5 billion (April-December 2024).
• However, agricultural imports surged by 18.7%, rising from $24.6 billion to $29.3 billion in the same period leading to decline in trade surplus.

Factors Driving Agricultural Exports

• High demand for rice, spices, coffee, and tobacco has kept exports stable.
• Basmati rice exports are expected to reach new highs in 2024-25, reinforcing India’s global leadership.
• Global supply shortages (e.g., drought in Brazil, typhoons in Vietnam) have benefitted Indian coffee and tobacco exports.
• India remains the top exporter of chilli, mint, cumin, turmeric, coriander, and fennel.

Challenges in Agricultural Trade

Decline in Major Exports

• Marine product exports fell from $8.1 billion (2022-23) to $7.4 billion (2023-24), mainly due to lower demand in the US, China, and EU.
• Sugar exports dropped from $5.8 billion (2022-23) to $2.8 billion (2023-24) due to government restrictions on food security concerns.
• Wheat exports, which were $2.1 billion in 2021-22, have almost stopped due to similar restrictions.
• Cotton exports have plummeted, from $4.3 billion (2011-12) to just $1.1 billion (2023-24).

Rising Imports Impacting Trade Surplus

• Pulses imports surged due to poor domestic production, expected to exceed $5 billion in 2024-25.
• Edible oil imports remain high, expected to be among the costliest years after 2021-22 ($19 billion) and 2022-23 ($20.8 billion).
• India has turned into a net importer of pepper and cardamom, despite being a major spice exporter.

Government Initiatives to Boost Agri Exports

• Export restrictions eased on non-basmati rice, though curbs on broken rice exports remain.
• Encouraging value-added exports in spices, coffee, and processed food.
• Free trade agreements (FTAs) with major markets to improve export competitiveness.
• Investment in agri-infrastructure, including cold storage and logistics, to support perishable exports.
• Promotion of organic farming and GI-tagged products to expand global market access.

India’s agricultural exports remain strong, but rising imports and government restrictions on key commodities are shrinking the trade surplus. A balanced policy approach is needed to ensure food security while maintaining export competitiveness.

DOWNLOAD PDF