Structural Changes in Commodity Composition and Direction of Agricultural Exports in India Under WTO Regime

Priyanka Mahajan and Paramjit Nanda

The IUP Journal of Agricultural Economics, 2011, vol. VIII, issue 3, 7-23

Abstract: The paper examines the impact of opening up of agricultural sector on the commodity composition and structural changes in agricultural and allied products’ exports and direction of agricultural exports of India during post-WTO period (i.e., 1995-96 to 2005-06). The study reveals that though India’s agricultural exports share in world’s agricultural exports witnessed a fluctuating and declining phenomena after 1996, the share of India’s agricultural exports in world total agricultural exports is greater than the share of India’s total exports in world’s total exports. Within agricultural and allied products, if we consider the share of India’s agricultural exports to world exports, there has been a sharp turnaround, contributed mainly by the enhanced share of exports of rice, tea and mate and spices. Commodity-wise analysis of comparative advantage shows that over the period, India has lost its comparative advantage in all of the agricultural commodities, except vegetables and fruits, sugar and sugar preparations. This loss of comparative advantage of India’s agricultural exports in world market is the result of imposition of various health and phytosanitary measures, environment and labor standards on country’s exports. To meet the challenges of the Indian economy, the Agreement on Agriculture (AOA) has to be viewed in an integrated manner along with other agreements, viz., Agreement on Sanitary and Phytosanitary conditions, Agreement on TRIPS, Agreement on TRIMS and Agreement on Dispute Settlement (World Bank, 2002). Further, easy export licensing and technical know-how regarding production, processing and marketing of exportable goods should be provided by the government.

Date: 2011
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