Export Preparedness Index (EPI) 2020
NITI Aayog releases report on Export Preparedness Index (EPI) 2020
WHY IN NEWS:
Hot from PIB !
SYLLABUS COVERED: GS 3: REPORTS
For PRELIMS go through the aim , focus and the best performers in this report.
For MAINS take a look at challenges and way a head with export councils and a better policy framework .
EXPORT PREPAREDNESS INDEX (EPI) 2020
NITI Aayog in partnership with the Institute of Competitiveness released the Export Preparedness Index (EPI) 2020 today.
- The first report to examine export preparedness and performance of Indian states.
- EPI intends to identify challenges and opportunities; enhance the effectiveness of government policies.
- EPI 2020 also encourages a facilitative regulatory framework.
4 PILLARS STRUCTURES OF EPI
- Business Ecosystem
- Export Ecosystem
- Export Performance.
- Export Promotion Policy
- Institutional Framework
- Business Environment
- Transport Connectivity
- Access to Finance
- Export Infrastructure
- Trade Support
- R&D Infrastructure;
- Export Diversification
- Growth Orientation.
- The Indian economy holds immense potential to become a strong exporter on the world stage.
- To realize this potential, it is crucial that India turns to its states and union territories and makes them active participants in the country’s export efforts.
- It is hoped that the Index will guide all stakeholders towards strengthening the export ecosystem at both the national and sub-national levels.
- The Index would be a helpful guide for the state governments to benchmark regional performance with respect to export promotion.
The 4 pillars and the rationale behind selection of each of them are given below:
- POLICY : A comprehensive trade policy provides a strategic direction for exports and imports.
- BUSINESS ECOSYSTEM : An efficient business ecosystem can help states attract investments and create an enabling infrastructure for individuals to initiate start-ups.
- EXPORT ECOSYSTEM : This pillar aims to assess the business environment, which is specific to exports.
- EXPORT PERFORMANCE : This is the only output-based pillar and examines the reach of export footprints of States and Union Territories.
- EPI has shown is that most Indian states performed well on average across the sub-pillars of Exports Diversification, Transport Connectivity, and Infrastructure.
- The report also highlights that export orientation and preparedness are not just restricted to prosperous states.
- Even emerging states can undertake dynamic export policy measures, have functioning promotional councils, and synchronize with national logistical plans to grow their exports.
- Overall, most of the Coastal States are the best performers.
- Six of eight coastal states feature in the top ten rankings, indicating the presence of strong enabling and facilitating factors to promote exports.
- Among the Himalayan states, Uttarakhand is the highest, followed by Tripura and Himachal Pradesh.
- Across the Union Territories, Delhi has performed the best, followed by Goa and Chandigarh.
- Chhattisgarh and Jharkhand are two landlocked states that had initiated several measures to promote exports.
- Other states facing similar socio-economic challenges can look at the measures taken by Chhattisgarh and Jharkhand and try to implement them to grow their exports.
This shows that a focused development of such baskets (like spices) can drive exports and also improve farmer income.
India faces three fundamental challenges as per the report :
- Poor trade support and growth orientation among states
- Poor R&D infrastructure to promote complex and unique exports.
- The EPI provides invaluable insights on how states can attain this goal.
- The final framework of the EPI was based on essential feedback from states, UTs and organizations like EXIM Bank, IIFT and DGCIS.
- For some of the indicators, RBI, DGCIS and Central ministries were consulted.
There is a need to emphasize on key strategies to address these challenges:
- Indian states should also focus on other key components in order to improve export competitiveness.
- A joint development of export infrastructure
- Strengthening industry-academia linkages
These strategies could be supported by revamped designs and standards for local products and by harnessing the innovating tendencies to provide new use cases for such products, with adequate support from the Centre.