IMPACT ON EXPORT GROWTH & SHARE - COMPARISON OF INDIA WITH OTHER COUNTRIES

Transcription

1 International Journal of Advanced Research in Management (IJARM) Volume 6, Issue 3, Sep-Dec (2015), pp , Article ID: Available online at ISSN Print: and ISSN Online: IAEME Publication IMPACT ON EXPORT GROWTH & SHARE - COMPARISON OF INDIA WITH OTHER COUNTRIES Mr. H. Aravinth Executive-Operations, Beta Shipping, Nigeria Dr. J. Rengamani Associate Professor, AMET Business School, AMET University Cite this Article: Mr. Aravinth, H. and Dr. Rengamani, J. Impact on Export Growth & Share - Comparison of India with other Countries. International Journal of Advanced Research in Management, 6(3), 2015, pp INTRODUCTION: In an International Trade there will be two parties who will buy and sell, the buyer is called as Importer and the Seller is called as an Exporter. World Trade Organization (WTO) monitors the International Trade and International Monetary Fund (IMF) monitors the financial transaction for the trade. The Economy growth of the country is determined by how the country manages its trade. When the country Exports more than their Import then its called as Trade Surplus, when the country Imports more than their Export then its called as Trade Deficit. All over the world every country competing with other country to gain more share in the world trade. Developed countries always have Trade Surplus. The Developing countries compete with other developing countries for their Export share. The developing countries will provide subsidy, scheme, promotions for increasing the export in their countries at the same time they will increase the duty, banning of imports etc. will help to restrict or reduce the Import of Goods. 2. OBJECTIVE: To analyze the impact of Export Growth and its contribution to the World Trade. To Identify the Export Growth rate in India. To study the comparison of Export growth and its contribution in India with Other Countries. Export (Goods) Growth and Share in World Exports : India and Other Countries. 3. STATEMENT OF THE PROBLEM: This study re-examines the export output relationship over the period, and finds strong evidence of export-led growth for India and with other countries. The problems facing in India with other countries which are listed below 49 editor@iaeme.com

2 Mr. H. Aravinth and Dr. J. Rengamani 1. Intellectual property infringement - including copyright, patent and trademarks. 2. Customs procedures that are not uniformly applied 3. Lack of competitive bidding for foreign government tenders. 4. The application of direct or indirect subsidies by a foreign government in favor of domestic suppliers. 5. Burdensome certification and testing requirements that are not required by domestic manufacturers. 6. Influence peddling - A corporate entity or country is interfering with fair trade practices at your expense. 7. Bribery, corruption and requests for payoffs - When foreign bribery prevents you from competing fairly on the basis of price, quality or service. 4. REVIEW OF LITERATURE: The study clearly indicates that there exists a significant and positive relation between exports and Gross National product (GNP) for the whole period under study i.e to The study supports Export-Led Growth Hypothesis (ELGH) in India over the period to as the coefficient of total exports (X) in equation (4) emerge stronger and significant in relation to manufactured exports (X m ). Investment emerges the most powerful variable in affecting the process of economic growth. It seems that exports play an important role, only after a particular stage of economic growth has been attained through domestic investment. The study reveals that none of the mechanisms of export-led growth i.e. economies of scale (via manufactured exports) and balance of payments effect on investment (export-investment link) are not proved statistically in case of India during the period under study. Our study confirms the results of the export-led growth mechanisms in industrial economies investigated by Lubitz Raymond (1973). Exports may be the handmaiden to economic growth in India rather than the engine of economic growth. The previous time-series studies, that used either Granger or Sims procedures and have been concerned with causal relationship between export growth and economic growth in developing countries, have provided mixed conclusions. The cointegration and error-correction modeling techniques used in this paper have revealed that there is a bi-directional causality between export growth and economic growth in seven of the eight countries considered. There is evidence for short-run Granger causality running from economic growth to export growth in all cases except Sri Lanka. While there is strong evidence for long-run Granger causality running from export growth to economic growth in all cases, there is evidence of short-run causality running from export growth to economic growth only in Indonesia and Sri Lanka. 5. RESEARCH GAP: With the notable exception of India, where English is widely spoken by businesspeople, most Asian countries will have both language and cultural barriers to entry. There will be hidden costs involved in getting up to speed on import restrictions and requirements, packaging needs, regulatory red tape, country-specific cultural norms and local business etiquette editor@iaeme.com

3 Impact on Export Growth & Share - Comparison of India with other Countries Customer preferences can differ quite markedly from the local Kiwi market and you'll need to research consumers in each country (and possible in different regions of the same country) to ensure you provide what your Asian customers want to buy. You'll probably need a new marketing strategy, complete with brand name and packaging, to suit your target country. Local knowledge is indispensable for almost any export venture, but more so for Asian countries. You'll either need to use an agent or distributor or possibly open an office in your target country, employing people with local knowledge and experience - and will probably need to travel to the country several times a year, at least in the early stages. As with any export venture, you'll also need sufficient capital to enable you to ramp up production while dealing with longer payment cycles (depending on your terms of trade and shipment methods) and higher transport and delivery costs. Some Asian countries will carry a high risk of copycat products emerging, which means you might need to invest in protecting your intellectual property and brand overseas. 6. RESEARCH METHODOLOGY: 6.1. Research Design Exploratory Research Data secondary data collected from various journals, magazines and from websites Analysis: Country Table 1 Export (Goods) value in India and other countries. Value (US$ Billion) Total China Korea Hong Kong Russia Singapore Mexico Taiwan India Malaysia Brazil Thailand Indonesia South Africa EDEs World editor@iaeme.com

4 Mr. H. Aravinth and Dr. J. Rengamani Country Table 2 Export Growth India and Other Countries Growth rate % Annual China Korea Hong Kong Russia Singapore Mexico Taiwan India Malaysia Brazil Thailand Indonesia South Africa EDEs World Table 3 Export Growth Share in world exports Value Share in world exports (%) Country Change in share / China Korea Hong Kong Russia Singapore Mexico Taiwan India Malaysia Brazil Thailand Indonesia South Africa EDEs World editor@iaeme.com

5 Impact on Export Growth & Share - Comparison of India with other Countries 7. FINDINGS Export (Goods) Value increased from 2009 to 2011 it has increased from 165USD to 303USD and later it has reduced to 297USD in Billions in the year Where as in China the Export (Goods) Value increased from 2009 to 2012 from 1202USD to 2049USD in Billions. Export growth rate in India fluctuated in 2009 the export growth rate was -15.2% in the corresponding year 2010 the export growth rate surged to 37.3% in the next year 2011 the export growth rate shot back to 33.8% in the next year 2012 the export growth rate came down to Export share in the world in the year % growth share in the year 2010 rise to 1.5% 2011 in 1.7% and in the 2012 reduced to 1.6% of the total world export. 8. SUGGESTIONS: The reasons behind the reducing export growth in India are due to poor investor climate. Loan process should be reduced to minimum procedure and approval should be done within a week. Subsidy s should be provided for the exporters as a encouragement to export more. Government should provide top Executive programs for expanding business to existing exporters in order to develop their customer base which will result in export growth. All MBA Graduates should be trained for a period of 1 month for starting an export business. 9. CONCLUSION: In India export growth has seen both increased and decreased exports where as in other countries like china they seen a steep growth of their export. This is because of the awareness missing among the civilians. The government should create more awareness among the people to invest in the export business and also to help them by supporting for international customers for minimum of 2years. REFERENCE: [1] Sahni, P. and Prof. Atri, V. N. Export Led Growth in India: An Emperical Investigation. IJMT, 2(7), 2012, ISSN [2] Ekanayake, E. M. Exports and Economic Growth in Asian Developing Countries: Cointegration and Error-Correction Models. JOURNAL OF ECONOMIC DEVELOPMENT, 24(2), [3] [4] [5] Nair, S. and Ramachandran, A. GAP Analysis for Implementing TQM in Seafood Exporting Firms. International Journal Management, 4(4), 2013, pp [6] Sreeja, J. P. and Dr. Meenakshi Sundara Rajan, A. Globalization and Its Impact on India s Petroleum Exports. International Journal of Management, 3(3), 2012, pp editor@iaeme.com

6 Mr. H. Aravinth and Dr. J. Rengamani [7] Dr. Dhami, J. K. and Gupta, M. Performance and Forecasting of Industrial Goods Exported from Indian Punjab Since International Journal of Management, 4(2), 2013, pp