Transport, Communication and Trade in India Imports, the Recent Trends in Foreign Trade of India, Balance of Trade Part 6

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Imports

After Independence, there has been a sharp increase in the value of imports in India. We now import about 6000 commodities. During pre-independence period, main items of imports were machinery, manufactured goods, textiles, chemicals, medicines etc. After independence in the early decades, India’s import consisted mainly of food grains because of the partition of the country.

India’s total value of import in 1950-51 was of Rs. 581 crores which had increased to Rs. 4,81,064 crores in 2004-05. There has been significant increase in the imports during the last 55 years.

In the year 2004-05, bulk import as a group accounted for about 40% of the total imports. This group includes fertilizers, cereals, edible oils, news print, and petroleum products. But only crude petroleum and products have 71% share among the bulk products import and about 28% share among the total import.

The other principal imports consist of pearls, precious and semi-precious stones, machinery, project goods, medicinal and pharmaceutical products, organic and inorganic chemicals, coal, coke and briquettes, artificial resins etc.

The Recent Trends in Foreign Trade of India

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At the time of Independence, India’s foreign trade was very limited. India was the main exporter of primary commodities and imported manufactured products and machinery. After independence there has been a rapid progress in the field of industry and agriculture. The international market has also expanded. The commodities of export and import have shown a great change in the last decades. India has developed trade relations with the countries of Asia, Africa, and Oceania for the promotion of her exports. Incentives such as, providing export credits at lower interest, and by removing restrictions and controls on the exports has helped in the promotion of export. Main stress is given to export of value-added commodities.

We have also adopted a policy of liberalisation of imports. Adoption of new import policy has strengthened the economy of the country. Some commodities which help in the manufacturing industries can now be imported on easy terms.

Balance of Trade

Difference between value of exports and imports is termed as balance of trade. When the value of exports and imports of a country is equal, it is a situation of balanced foreign trade. If exports exceed the imports, it is favourable trade, and on the other hand when imports are more than exports, it is unfavourable trade.

At the time of Independence, our foreign trade was favourable but after Independence, in the first two decades, the imports of India increased rapidly due to the imports of food grains. At present the imports of the country exceed the exports. Thus, our foreign trade has become unfavourable. In terms of rupee, the trade deficit in 2004-05 was Rs. (-) 123995. It is worth noting that our exports and imports have increased in volume and value remarkably. But over the past 55 years our share in world trade has decreased considerably. It is not even one percent of the world trade.

In Brief, It Can Be Said That:

The term infrastructure denotes the essential elements forming the bases of a system or structure. Transport, communication, and trade are important infrastructural resources of economy. These services provide support for the development of entire economy, particularly agriculture and industries.

Railways, roads, and pipe lines are the means of land transport. They play an important role in strengthening the national unity. They also promote social and economic prosperity in the country. Water transport is an inexpensive but slow means of transport. The development of inland water transport is limited only to the eastern part and eastern coastal plains. India is ideally situated on the busy Suez route joining Australia and south-east Asia and Europe. The air transport is the fastest though costliest means of transport. It is also suitable in the areas where construction and maintenance of surface transport is difficult, such as north-eastern region.

All these means of transport have brought the world closer. Rail transport provides services particularly for long distance and carries bulk of traffic at one time. Northern plains, eastern coastal plains, and Gujarat plains have dense network of railways, while the north-eastern region, western Rajasthan, and the Himalayan region have sparse railway network. Road transport provides door to door services. It is flexible and is suitable for short distances. Punjab, Kerala, and Tamil Nadu have the highest density of surfaced roads.

Communication involves sending or receiving messages at individual or mass level. It includes postal services, telegraph, telephone, tele printers, radio, television, and print media. Radio and television belong to electronic telecommunication media. Transport and communication are interrelated and they strengthen and supplement each other.

The trade relations of India have grown very rapidly after Independence. India has bilateral trade with many developed and developing countries. There has been a significant change in the commodities of export and import after independence. India has now adopted the policy of liberalisation of trade removing restrictions on imports. Despite phenomenal growth in foreign trade India’s share in world trade is very low- not even one per cent.