Expanding exports with e-commerce

Context:

India is quickly emerging as one of the leading players in the global e-commerce industry. E-commerce is dramatically opening up the global market for Indian entrepreneurs at scale and this has changed the fate of ‘Made in India’ products.

What is the State of Exports from India?

Manufacturing:

• India’s manufacturing sector has grown 3 times over the last three decades in FY22 with contributions from traditional sectors. Manufacturing Production in India increased 2.60% in December of 2022 over the same month in the previous year.

Other categories:

• There’s also been a steady spike in other categories like bed linens, jewellery, toys, coffee, butter, honey, millets, musical instruments and more.
• The export of India’s toy story has grown at nearly 30% CAGR over the last seven years.
• Export of butter and dairy spreads from India has risen at a 25% CAGR.
• The rise of the Direct-to-Consumer (D2C) revolution in India.
• India’s merchandise trade crossed the previous peaks.
• Outbound shipments grew.

What are the Challenges with E-Commerce Exports in India?

• Infrastructural Barriers: Lack of proper infrastructure, such as warehousing and transportation.
• Payment and Financial Services: Access to payment and financial services, especially for small businesses, is still a major challenge.
• Lack of Trust: Customers are often hesitant to make online purchases from unfamiliar websites, which can limit the growth of e-commerce exports.
• Shipping and Delivery: It can be expensive and time-consuming, leading to dissatisfaction among customers.
• Customs and Duties: It can make exporting goods challenging and time-consuming.
• Cybersecurity: E-commerce websites are vulnerable to cyber attacks, which can lead to loss of sensitive information and negatively impact the reputation of the business.
• Lack of Standardization: In terms of product quality, delivery, and customer service can make it difficult for e-commerce businesses to gain a competitive edge.
• Competition from International Players: It difficult for Indian companies to grow and succeed in the global market.

What are the Related Steps taken?

• Free-trade Agreements: To encourage Cross-Border Trade, the government has signed various Free-trade agreements with countries such as the UAE, the UK, Australia, and others, which has led to a rise in exports.
• Digital India initiative: This initiative has provided solid impetus to other government-led initiatives, including Start Up India and Aatmanirbhar Bharat, which have great potential to translate into global success.

How India can Lead the E-commerce Export Market?

• Creating more Awareness: It can be done through:
  • Education and training can help in gaining a better understanding of the benefits and opportunities offered by e-commerce exports.
  • Networking events which can serve as a platform for businesses and individuals to connect and share ideas.
  • Marketing campaigns can also play a crucial role in creating awareness about e-commerce exports.

• Improving Infrastructure: Better infrastructure facilities such as roads, ports, and warehouses can make it easier for e-commerce companies to export their products.
• Simplifying Export Regulations: The government should simplify it to make it easier for e-commerce companies to start exporting.
• Encouraging Foreign Investment: It will help to bring in more resources and expertise to help companies grow.
• Developing a Strong Logistics Network: India needs to develop this network to ensure that products reach their destination on time.
• Building Strong Partnerships: The government can build strong partnerships with other countries and organizations to help Indian e-commerce companies access new markets and find new customers.

News Source: The Hindu 

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