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India's agricultural exports fell 9% to $43.7 billion, impacted by global crises and domestic restrictions, yet Basmati rice surged.
India's agricultural exports faced a significant setback, dropping by 9% during the April-February period of 2023-24. Various global and domestic factors played a role in this decline.
The Red Sea crisis, coming from tensions in the Middle East, and the Russia-Ukraine conflict were major global events affecting India's agricultural exports. These crises disrupted trade routes and increased uncertainties, impacting export volumes and prices.
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Domestic restrictions on key commodities such as rice, wheat, sugar, and onions added to the export decline. Export bans and limitations on these products led to significant losses estimated at $5-6 billion in the last fiscal year. The Indian government imposed restrictions on the export of certain agriculture products to ensure domestic availability and stabilize prices, further dampening export figures.
India's agricultural GDP growth slowed to 0.7% in 2023-24 from 4.7% in the previous fiscal year. This slowdown reflects the challenges faced by the agricultural sector amidst global and domestic uncertainties. The reduced agricultural GDP growth underscores the broader economic implications of the export decline.
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Despite the overall decline, some commodities showed positive growth. Basmati rice exports surged by 22%, reaching $5.2 billion during April-February 2023-24. This growth highlights the resilience of certain segments of agricultural exports and their ability to navigate challenges in the global market.
India witnessed growth in the export of alcoholic beverages, particularly premium Indian brands. Despite the overall export decline, India's alcoholic beverages sector showed promise. However, India's share in the global alcoholic beverages market remains relatively small, standing at $180 million, ranking 40th globally. Efforts to increase market penetration and enhance competitiveness are crucial for further growth in this sector.
Officials are closely monitoring developments, including the Israel-Iran conflict, for potential impacts on exports. Despite challenges, sectors like fresh fruit, meat, and processed vegetables showed positive growth, indicating opportunities for the agricultural export sector to rebound. Policy measures aimed at addressing both global and domestic challenges, coupled with efforts to promote key export sectors, are essential for revitalizing India's agricultural export landscape and ensuring sustainable growth in the future.
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India's agricultural exports faced a significant 9% decline to $43.7 billion during April-February 2023-24, attributed to global crises and domestic restrictions. Despite challenges, segments like Basmati rice showed resilience. Efforts to monitor geopolitical developments, address domestic constraints, and promote key export sectors are essential for revitalizing India's agricultural export landscape and ensuring sustainable growth.