WTO and India’s Agricultural Trade Potential

Abstract

India is an agrarian economy, which contributes about 15 percent of GDP and provides livelihood to more than 50 percent of the total population of the country. WTO has shown a momentous part in the expansion of the export market for developing and developed economy. Several measures are taken by WTO in order to reduce trade restrictions and trade barriers. In this study, we have been analyzed India’s agriculture trade, composition, direction and potential. The study is dependent on secondary data which is gathered from International Trade Centre, Department of Agriculture and Co-operation. Two-digits HS code products range from 01-24 were taken for the study. Few specific two and four-digit HS code products were taken to analyze the Revealed Comparative Advantage (RCA). Data were taken for the period 2001-2018. The export potential of India in international market was identified using reckoning of Balassa’s index of RCA. Study reveals that there has been a positive agricultural trade balance since 1990-91. In some agriculture commodities like coffee, oilseeds, tea and wheat India has a comparative advantage in export and India have both developed and developing countries such as UAE, USA, Saudi Arabia, Vietnam and Iran are exporting partner. In the last, study suggest that the government of India should focus more on producing agriculture products which has a country comparative advantage in trade like tea, oilseeds, coffee and wheat. Study suggests that EXIM bank should provide adequate credit to encourage agricultural export. The farming should be export-oriented to meet international standards.