KARNATAKA’S EXPORTS – VOLUME,COMPOSITION, AND DIRECTION

KARNATAKA’S EXPORTS – VOLUME,COMPOSITION, AND DIRECTION

Exports of Karnataka

Karnataka has a long tradition of overseas trade. Historically, Karnataka has been a major exporter of commodities like coffee, spices, silk, cashewnuts, handicrafts and agarbathies. In the last two decades, the State has emerged as a major player in the export of electronic and computer software, engineering goods, readymade garments, petrochemicals, gems and jewellery, agro and food processing products, chemicals, minerals and ores, marine products, etc. Karnataka has carved out a niche for itself in the global market place as the knowledge and technology capital of the Country. The State has made rapid and spectacular strides in the new economy. Information technology, biotechnology and research and development institutions have enhanced Karnataka’s achievements at national and global levels. Karnataka accounts for more than one third of electronics and computer software exports from the country. It is also a leader in exports of readymade garments, gems and jewellery, petrochemicals and engineering commodities from Southern Region.

India’s Merchandise exports during 2001-02 added upto Rs.2,10,010 Crores (US$ 43.99 billion)*, whereas Karnataka’s total exports during the year 2001-02 were over Rs.20,000 crores (US $ 4.12 billion) (provisional)**. During the 9th Five Year Plan period (1997-2002) Karnataka achieved remarkable growth in exports growing from Rs.8432 crores in 1997-1998 to over Rs.20,000 crores in the year 2001-02. The average annual growth rate has been about 15%. Percentage share of Karnataka in India’s export today stands at about 7%

(Value in MLN US $)

Sl No	Commodity	2014-15	2015-16	2016-17
1	Electronics & Computer Software	58,900.00	60,503.00	62,666.37
2	Semiconductor	46.63	47.94	25.33
3	Wool & Woolen products, Silk product, Readymade Garments	1,726.43	2,273.72	2,231.81
4	Aerospace	340.00	1,578.65	450.31
5	Petroleum	6,680.11	1,841.34	1,713.51
6	Engineering	3,377.91	3,082.71	4,093.65
7	Automobile	200.00	432.50	406.12
8	Iron Ore and Minerals	122.44	122.89	136.17
9	Basic Chemicals, Pharamaceuticals and Cosmetics	963.45	1,648.10	1,930.33
10	Agriculture & Processed food including seeds and bevarages, Coffee, Cashew & Cashew Kernals, Spices	1,468.47	1,421.91	1,319.03
11	Marine Products	214.49	115.97	157.32
12	Gems and Jewellery	3,594.47	5,047.20	5,256.38
13	Handicrafts	89.62	191.43	166.67
14	Leather Products	88.75	54.18	55.46
15	Chemicals & Allied Products	156.05	73.33	77.56
16	Plastic Goods	61.50	119.58	133.47
17	Others	404.00	1,212.73	1,251.48
	Total	78,434.32	79,767.18	82,070.97

The EXIM policy of the Govt.of India provides a national policy framework. At the same time, the State Govt. needs to provide focussed facilitation to enable rapid growth of exports from Karnataka in sectors in which the State enjoys competitive advantages. It is in this context that a policy framework to give impetus to establishing best practices, providing for capacity building and facilitating quality and competitiveness of domestic exporters becomes critical.

In order to achieve these objectives, the following strategy will be adopted.

To create a strong networking with Export Promotion Councils, FIEO, ITPO, NCTI, and Product Sectoral Associations to give impetus to Public – Private partnership.

To provide E-Governance support to exporters in Karnataka.

To establish a B2B exchange, which would facilitate even the small and tiny unit in the State to take up online trading activity

>To create a strong analytical database on exports and exporters in Karnataka

To promote Public-Private initiative in developing competitive export infrastructure

To setup an institutional mechanism in the State for promoting exports like State Level Export Promotion Council, State Level Export Promotion Committee and District Level Export Promotion Committee

To strengthen and restructure VITC as the Export Promotion Board of Karnataka, which shall be the Nodal Agency to plan and execute strategies to sustain Karnataka as a global hub for international trade.

To focus on catalysing competitive advantages that Karnataka has in the Global market by increasing its exports in Information Technology, Bio Technology, Food Processing, Electronics & Communications, Garments, Machine Tools and Precision Engineering Goods, besides the traditional exports.

To identify sector specific support measures required for acceleration of exports in sectors in which the State has competitive advantages and to encourage them in consultation with the concerned sectoral association.

Exporters in Karnataka are mostly concentrated in few districts, the majority of them being located in Bangalore. All sections of exporters have their export associations. VITC should closely and actively co-ordinate with all the export associations and take up the following measures.

Evolve suitable export oriented strategies focusing on specific product sectors with inputs from the Export Associations / Exporters. This will include taking part in international trade fairs / exhibitions, providing inputs on technology upgradation, packaging, quality, etc.,

Undertake market research on focus countries, markets and sectors and provide market information to the exporting community. I

Have a time bound action plan to implement the above strategies and accelerate export growth.

For effective export promotion in the districts, the industries and traders may be classified into three categories in each district, as given below

i) Industries / traders who are already exporting
ii) Industries / traders who are exporting through merchant exporters

iii) Industries / traders who have not yet entered the export field.

Efforts will be made to upgrade industries / traders in categories (ii) & (iii) to take up direct exports. A District Level Export Promotion Committee(DLEPC) in all the districts will be constituted.

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