Emerging Export Opportunities for Indian Businesses

Key Opportunities for India’s Export-Driven Companies

India, with its dynamic economy, robust manufacturing ecosystem, and youthful, tech-savvy workforce, is steadily emerging as a hub for export-oriented businesses. The nation offers an attractive combination of cost-effective production, strategic location, and government-backed support, making it a preferred destination for enterprises eyeing global markets.

India’s Position in Global Trade

India has a long-standing reputation in global trade, being a major exporter of commodities like coffee, tea, spices, and gemstones. Over the last decade, the country has significantly expanded its export portfolio, particularly in manufacturing, thanks to initiatives like Make in India.

In FY 2023-24, India recorded $776.68 billion in merchandise and services exports. This growth is supported by the country’s extensive 7,516-km coastline and 229 ports, enhancing its ability to efficiently connect to international markets. The nation’s export potential is further amplified by government incentives, strategic trade agreements, and infrastructure upgrades.

Transforming Port Infrastructure

India’s port infrastructure has witnessed remarkable transformation over the past decade, positioning the country as a globally competitive export hub. The average turnaround time at major ports has seen a dramatic reduction from 93.59 hours in 2013-14 to 48.06 hours in 2023-24, significantly improving the efficiency of cargo handling and shipping operations.

This achievement reflects a series of strategic upgrades aimed at eliminating logistics bottlenecks and enhancing overall port performance.

Key initiatives include the construction of new berths and terminals to increase handling capacity and reduce congestion. The development of parking plazas at ports has improved the movement and management of cargo trucks. Extensive mechanisation and modernisation of existing berths have further streamlined operations.

Additionally, the expansion of hinterland connectivity through better road and rail links has facilitated smoother cargo flow to and from ports. Finally, the adoption of digital solutions has optimised processes, ensuring faster, more reliable port services for global trade.

Government Incentives Driving Export Growth

India’s export sector has witnessed significant momentum, thanks to proactive government initiatives designed to strengthen domestic manufacturing and enhance global competitiveness. Two key pillars supporting this growth are the Production-Linked Incentive (PLI) Scheme and the Foreign Trade Policy (FTP) 2023-28.

Production-Linked Incentive (PLI) Scheme

Launched in 2020, the PLI Scheme is a landmark initiative aimed at driving India’s manufacturing prowess and positioning the country as a key player in global supply chains. With a substantial budget outlay of $26 billion, the scheme incentivises production in high-potential sectors that are critical to India’s export ambitions. These include:

• Electronics

• Telecommunications equipment

• Processed foods

• Pharmaceuticals

• Automobiles

By FY 2023-24, the PLI scheme had already yielded tangible results:

• Exports worth over ₹3.20 lakh crore driven by PLI-supported industries

• Employment generation exceeding 6.78 lakh jobs, boosting India’s manufacturing workforce

• A stronger foothold in global supply chains, with increased foreign investment and technology transfer

The PLI scheme continues to play a crucial role in diversifying India’s export basket and advancing its Make in India goals.

Foreign Trade Policy (FTP) 2023-28

India’s Foreign Trade Policy 2023-28 complements the PLI Scheme by creating an enabling environment for exporters. The policy framework is designed with three core priorities:

• Continuity of successful export promotion schemes, ensuring stability and predictability for businesses

• Trust-based partnerships between the government and exporters, encouraging compliance and innovation

• Responsiveness to global trade dynamics, allowing India to swiftly adapt to evolving market conditions

The FTP 2023-28 fosters growth across both traditional export sectors and emerging industries, ensuring India’s exporters remain competitive in a dynamic global landscape.

Ease of Doing Business for Exporters

India’s export growth story is not only driven by production incentives but also by a supportive policy ecosystem that reduces financial and operational hurdles for exporters. Two standout initiatives—Interest Equalisation Scheme (IES) and Market Access Initiative (MAI)—have made significant contributions toward creating a more exporter-friendly business environment.

Interest Equalisation Scheme (IES)

Operational since 2015, the Interest Equalisation Scheme (IES) aims to make export credit more affordable, particularly for MSMEs and exporters of specified goods. The scheme provides interest rate subsidies ranging between 3% to 5% on pre- and post-shipment export credit. By lowering borrowing costs, IES helps businesses secure the working capital they need to fulfil export orders competitively.

To keep pace with the evolving needs of exporters, the government has extended the scheme until August 2024 and allocated an additional ₹2,500 crore for its implementation. This extension ensures that Indian exporters continue to benefit from reduced capital costs, thereby enhancing their ability to price products competitively in global markets.

Market Access Initiative (MAI)

Launched in 2018, the Market Access Initiative (MAI) focuses on helping Indian exporters expand into new and emerging markets beyond traditional destinations. The scheme provides financial assistance for:

• Market research to identify opportunities and challenges

• Marketing and promotional activities to increase visibility

• Brand-building efforts that strengthen India’s image abroad

• Compliance support for meeting international regulatory standards

By addressing key barriers to market entry, the MAI scheme has been crucial in diversifying India’s export base and enhancing the global competitiveness of Indian businesses.

Duty Benefits and Tax Incentives for Exporters

India’s export ecosystem is strengthened by a host of duty benefits and tax incentives that reduce input costs, enhance profitability, and make Indian goods globally competitive. These schemes help manufacturers and exporters manage compliance and operational costs while aligning with international trade standards.

Advance Authorisation Scheme (AAS)

The Advance Authorisation Scheme (AAS) allows exporters to import raw materials duty-free, provided these materials are used to manufacture goods meant for export. By eliminating import duties on critical inputs, the scheme lowers production costs, boosts competitiveness, and enables manufacturers to offer attractive pricing in international markets.

Duty-Free Import Authorisation (DFIA)

The Duty-Free Import Authorisation (DFIA) scheme similarly permits exporters to import raw materials without paying import duty, on the condition that the final products are exported. This policy is particularly beneficial for manufacturers producing goods that must meet exacting global quality standards, as it helps balance cost pressures without compromising on compliance.

GST-Linked Export Benefits

To enhance tax efficiency for exporters, the government offers several GST-related benefits:

• GST exemptions through a Letter of Undertaking (LUT), allowing exports without upfront tax payment.

• 0.1% concessional GST rates on procurement of goods meant for export, easing working capital strain.

• Refund of IGST paid on exported goods, ensuring that tax outflows don’t erode competitiveness.

These measures streamline tax processes and improve the ease of doing business for exporters.

Sectors with High Export Potential

India’s export landscape has evolved well beyond traditional commodities like tea, coffee, and textiles. Several sectors are now driving the country’s robust performance in global markets:

Petroleum Products

• Contribute 18.8% of India’s total exports (April–June 2024-25).

• Major destinations include the Netherlands and Middle East nations.

Electronics and Telecom

• Rapid growth in smartphones, telecom equipment, and related electronics.

• The USA remains the largest export market for these products.

Pharmaceuticals and Biologics

• Make up 5.2% of India’s export basket.

• Known globally for high-quality generic drugs, vaccines, and APIs (active pharmaceutical ingredients).

Engineering Goods

• Rising global demand for electrical machinery, automotive components, and capital equipment.

Ceramics and Glassware

• Exports to Europe and the Middle East have increased, driven by strong demand for high-quality, decorative, and industrial products.

Agrochemicals

• India’s agrochemical exports (insecticides, fungicides, rodenticides) touched $4.32 billion in 2023, doubling its global market share from 5.89% in 2014 to 10.85%.

Tyres and Rubber Products

• With $2.66 billion in exports in 2023, India is now the 8th largest tyre exporter globally, a jump from 14th position in 2014.

Free Trade Agreements (FTAs) Boosting Exports

India’s strategic push for greater integration into global markets is reflected in its robust network of Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs). These trade pacts help eliminate or reduce tariffs and non-tariff barriers, making Indian exports more competitive worldwide.

• 14 FTAs signed to date, including with:

  • UAE — unlocking trade potential in the Gulf region

  • ASEAN — providing market access across Southeast Asia

  • Australia — enhancing cooperation in key sectors like mining, education, and manufacturing

  • Mauritius — strengthening bilateral trade and investment

  • EFTA (European Free Trade Association: Iceland, Liechtenstein, Norway, Switzerland) — easing trade with advanced economies

India is also negotiating major FTAs with the European Union, UK, and Oman, which are expected to further expand its global trade footprint and integrate Indian businesses into new value chains.

Recent Trade Policy Reforms

India’s Foreign Trade Policy (FTP) 2023 introduces measures aimed at making exports more agile, inclusive, and digitally driven. The focus areas include:

Promoting cross-border e-commerce exports — tapping into growing online demand globally.
Districts as Export Hubs (DEH) — encouraging grassroots businesses and local industries to participate in exports.
Lowered application fees for MSME exporters — easing entry barriers for smaller businesses.
Faster digital approvals — reducing compliance timelines for export obligations.
Simplified electronic Certificate of Origin (COO) — improving transparency and efficiency in documentation.

These reforms are designed to streamline export operations and bring smaller enterprises and new sectors into the export ecosystem.

Additional Government Schemes Enhancing Export Competitiveness

RoDTEP Scheme (Remission of Duties and Taxes on Exported Products)

Launched in 2021, RoDTEP helps exporters offset embedded taxes and duties that aren’t refunded through other schemes. With an allocation of ₹15,070 crore, it ensures that hidden costs don’t erode India’s price competitiveness in global markets.

Star Export House Certification

This recognition from the Directorate General of Foreign Trade (DGFT) offers various privileges, including:

• Tariff remission on smaller export consignments.

• Faster customs clearance processes.

• Exemption from mandatory bank guarantees for certain export promotion schemes.

Such benefits reduce red tape and make exports more attractive, especially for smaller players.

NIRVIK Scheme (Niryat Rin Vikas Yojana)

Launched in 2020-21, NIRVIK provides low-premium export credit insurance and ensures quicker settlement of claims. It offers up to 90% cover of principal and interest, helping MSMEs manage risks and explore new markets with confidence.

India’s Future as a Global Export Powerhouse

India’s transformation as an export-driven economy is powered by:

Progressive policy frameworks that lower barriers and incentivise value-added exports.

Massive infrastructure upgrades, from modern ports to enhanced logistics networks.

Digitalisation, enabling faster, transparent export procedures.

Strategic trade partnerships, positioning India in key global value chains.

By shifting from a commodity-dominated export basket to high-value sectors like electronics, pharmaceuticals, and engineering goods, India is solidifying its role as an emerging global trade leader.