900 319 0030

India’s Agricultural Exports

iasparliament Logo
May 06, 2022

Why in news?

Food inflation fears and supply uncertainties may dampen prospects for India’s agricultural trade after last year’s record $50 billion-plus exports.

What is the status of India’s agricultural exports?

  • India’s agricultural exports crossed $50 billion during the fiscal year ended March 31, 2022.
  • The imports, too is scaling an all-time-high of $32.4 billion.
  • The years subsequent to 2013-14 witnessed falling exports alongside rising imports, leading to a narrowing of the surplus to $8.1 billion in 2016-17.
  • Exports took long to recover but the imports continued shooting up and the farm trade surplus stood at $17.8 billion for 2021-22.


What is the impact of global prices on the agricultural trade?

  • India’s agricultural trade performance is closely linked to international commodity prices.
  • The UN Food and Agriculture Organization’s (FAO) Food Price Index averaged to 122.5 points in 2012-13 and 119.1 in 2013-14.
  • The index collapsed to 90 points in 2015-16.
  • The last two years, especially after October 2020, have witnessed a renewed boom in global agri-commodity prices because of
    • The lifting of Covid-induced lockdowns
    • The after-effects of the massive liquidity injections by central banks post the pandemic
  • The return of demand has helped Indian agri exports rebound and go past $50 billion.
  • In general, high international prices are favourable for exports of farm produce.
  • High global prices also tend to benefit farmers, both by pushing up their realizations closer to export parity levels and by making imports more expensive.
  • However, 2021-22 turned out different, recording a surge in exports as well as imports.

The FAO Food Price Index (FFPI) is a measure of the monthly change in international prices of a basket of food commodities. It consists of the average of five commodity group price indices weighted by the average export shares of each of the groups over 2014-2016.

What about the trade composition?

  • Exports- Leading the exports list is marine products, whose value has steadily risen, from just over $5 billion in 2013-14 to $7.8 billion in 2021-22.
  • But the real increase has come from rice (specifically non-basmati), sugar and wheat, with their exports breaking all earlier records.
  • 2021-22 was a remarkable year for rice and wheat and the two cereals hit unprecedented levels through the public distribution system too.
  • Amongst the various agri-commodity exports, rice ranks first when both basmati rice and non-basmati rice are included.
  • Exports in spices mostly comprise chilli, mint products and cumin.
  • Many of the items that contributed to the previous export boom have displayed stagnation which includes basmati rice, buffalo meat, oil meals, guargum and raw cotton.
  • Imports- As far as imports go, the spike in 2021-22 has been largely because of vegetable oils.
  • Pulses imports were at $2.2 billion in 2021-22.
  • Other big-ticket import items were fresh fruits (mainly almonds and apples), cashew (basically raw nuts for re-export after processing), spices and natural rubber.
  • In spices, India happens to be both a large importer ($1.3 billion in 2021-22) and exporter ($3.9 billion).
  • On the other hand, there has been a rising trend in imports of pepper, cardamom and other traditional plantation spices from countries such as Vietnam, Sri Lanka and Indonesia.


What are the prospects of India’s agri products?

  • The Russian invasion of Ukraine has imparted bullishness to agri-commodity markets.
  • There are expectations of the country’s wheat and even maize exporters filling, at least partly, the void left by the two warring breadbasket nations.
  • Concerns- Reports from the ground suggest significant yield losses, particularly for the wheat crop that was at the critical grain-filling stage because of the rising temperatures.
  • The overall prospects for agri-exports hinge largely on the monsoon.



  1. https://indianexpress.com/article/explained/farm-exports-surge-all-time-high-so-do-imports-7903142/
  2. https://www.fao.org/worldfoodsituation/foodpricesindex/en/


Login or Register to Post Comments
There are no reviews yet. Be the first one to review.



Free UPSC Interview Guidance Programme