Understanding India’s Agricultural Trade Landscape in FY24

Current Export and Import Trends in India’s Agriculture

In the fiscal year 2024 (FY24), India witnessed a notable shift in its agricultural trade dynamics. The total value of agricultural exports stood at $48.77 billion, marking an 8.19% decrease from the previous year's exports of $53.12 billion. In contrast, imports of agricultural commodities surged to around $35 billion, driven primarily by increasing demand for edible oils and pulses.

Dominant Commodities in Agricultural Exports

India's agricultural exports are characterized by a diverse range of commodities. The key items include:

• Rice
• Wheat
• Fresh fruits and vegetables
• Spices
• Pulses
• Cashew nuts
• Sugar
• Tea
• Coffee
• Processed foods
• Dairy products
• Meat

Additionally, there is a growing emphasis on value-added and organic products, which are becoming increasingly significant in global markets.

Factors Contributing to the Decline in Exports

The reduction in agricultural exports for FY24 can be largely attributed to specific government interventions aimed at ensuring food security and stabilizing domestic prices. Notably, the ban on wheat exports was enforced in May 2022, while restrictions on non-basmati white rice exports were implemented in July 2023.

Strategies to Enhance Agricultural Exports

To bolster agricultural exports moving forward, several strategies can be employed:

• Promote value-added and processed agricultural products.
• Diversify export destinations to mitigate risks associated with over-reliance on particular markets.
• Enhance compliance with international quality standards to increase competitiveness.
• Upgrade infrastructure to meet export targets efficiently.

Major Agricultural Trade Partners

India's agricultural exports are directed towards several key trade partners, including:

• United Arab Emirates (UAE)
• Singapore
• Netherlands
• United States (US)
• Tanzania
• Ghana
• Angola
• Kenya
• Haiti

Improving Trade Policy for Better Outcomes

To enhance the agricultural trade environment, the following policy changes are recommended:

• Eliminate taxes on raw materials to lower production costs.
• Implement a uniform tax on imported agricultural goods to prevent anti-competitive practices.
• Reduce procurement requirements for traders to 50%, ensuring more favorable pricing for farmers.

Prioritizing Areas for Growth

In light of rising global demand, India should focus on prioritizing organic products and high-value commodities, such as spices, processed fruits, and herbal goods, to ensure sustainable growth in its agricultural sector.