Export Preparedness Index 2022 Report

Context :The report discusses India’s export performance, followed by an overview of the country’s sector-specific export performance. The report emphasizes developing districts as export hubs and analyzes district-level merchandise exports in the country.

Export Preparedness Index (EPI)

EPI is a comprehensive tool that measures the export preparedness of the States and UTs in India.

Exports are vital for stimulating economic growth and development in a country, which necessitates understanding the factors which influence export performance.
The index undertakes a comprehensive analysis of States and UTs across export-related parameters to identify their strengths and weaknesses.
Developing the methodology for the index is an evolving process that constantly incorporates stakeholder feedback.
The current EPI rankings aim to help states address their specific challenges, though not directly comparable to previous editions.

The performance of state or Countary assessed 4 Pillars are

Policy Pillar: This pillar evaluates state and UT policies supporting exports and the effectiveness of their institutional frameworks for implementation.
Business Ecosystem: This pillar assesses the business environment in states and UTs, including infrastructure availability and transport connectivity.
Export Ecosystem: This pillar examines the state of export-related infrastructure in states and UTs, as well as the trade support services they provide to exporters, and the level of research and innovation activities that foster export competitiveness.
Export Performance: This indicator assesses export growth, diversification, and global presence of states and UTs.

Objectives

The report aims to provide region-specific insights to state governments, assisting them in making informed decisions and promoting inclusive growth.
To introduce a framework that encourages competitiveness within the country by comparing the export preparedness of States and UTs.
To help stakeholders to identify and improve the factors that affects their state’s exports, and thus enhance their export competitiveness.
To offer a comprehensive analysis for policy reforms and the development of a conducive export ecosystem using its data-driven approach.

Key Highlights

The EPI 2022 Report observed that most ‘Coastal States’ have performed well, with the states of Tamil Nadu, Maharashtra, Karnataka and Gujarat being the top-performers in the Export Preparedness Index across the country, in all categories of states.
State governments’ efforts have resulted in the creation of export promotion policies and district-level export action plans.
It said, 73 percent of districts in the country have an export action plan, and over 99 percent are covered under the One District One Product scheme.
It states that 100 districts in the country are responsible for nearly 87 percent of the country’s exports.

Critical Observations

States have lagged in terms of transport connectivity. Lack of air connectivity hinders regional movement of goods, particularly in landlocked or geographically disadvantaged states.
Weak performance in R&D reflects inadequate focus on innovation’s role in exports.
The state government has to both continue and extend its support to the industries which are struggling.
26 states in the country have registered a decrease in the gross value addition of their manufacturing sector.
10 states have registered a decrease in the inflow of Foreign Direct Investment (FDI).
Limited capacity-building workshops hinder exporters’ global market penetration, with most states organizing fewer than 10 workshops per year.
For the effectiveness of existing government schemes to support states, timely approval of projects is a must.

What are the Recommendations of the EPI?

Adoption of Good Practices: States should be encouraged to adopt good practices from their peers if they suit their needs. Learning from successful states can help lagging states improve their export performance.
Investment in Research and Development (R&D): States should prioritize R&D investment for product innovation, market-specific products, quality improvement, cost reduction, and efficiency enhancement.
- Establishing dedicated research institutes with regular funding can help states improve their exports.
Leveraging Geographical Indication (GI) Products: States should capitalize on their unique GI products to establish a presence in the global market. Promoting and improving the manufacturing and quality of GI products can boost exports.
- For example, Kancheepuram Silk products can only be exported by Tamil Nadu and have no competition across the country.
Diversification of Export Markets:Promoting high-growth sectors like IT, pharma, automotive, textiles, and renewable energy can boost India’s export potential.

FAQs Related with Export Preparedness Index 2022 Report

Ques 1: What is the Export Preparedness Index (EPI) 2022 Report?

Answer: The EPI 2022 Report evaluates the export readiness and performance of states and union territories in India.

Ques 2: What factors are considered in the EPI 2022 Report?

Answer: The EPI 2022 Report assesses factors like export performance, diversification, infrastructure, policy support, and promotion policies.

Ques 3: How can the EPI 2022 Report benefit states and union territories?

Answer:The EPI 2022 Report assists states and UTs in enhancing export competitiveness by identifying improvement areas through insights and rankings.