Global headwinds hurt India exports

Silver lining has been the increase in shipments of electronic goods

By N.R.I. Problems/H. P. Ranina

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The Port of Nhava Sheva is India's largest port handling almost half of the country's maritime traffic. - KT file
The Port of Nhava Sheva is India's largest port handling almost half of the country's maritime traffic. - KT file

Published: Mon 17 Apr 2023, 2:24 PM

Last updated: Tue 18 Apr 2023, 2:36 PM

Question: Has the slowing down of the global economy affected India’s export performance during 2022-23? I believe that logistical disruptions have affected export of goods worldwide.

ANSWER: Exports of goods from India have shrunk during three of the last five months of the financial year 2022-23. They will be lower than the government’s projections of $470-480 billion. However, the fall in export of goods has been compensated by a substantial rise in the export value of services. It is therefore projected that the exports of both goods and services will be more than $760 billion which will be an increase of 12.4 per cent compared to the export of goods and services which were $676 billion in the financial year 2021-22. The increase in export of services has to be judged in the backdrop of the global recessionary trends, high inflation and elevated interest rates. As a result of the increase in service exports, the trade deficit has also come down as the import bill has been kept in check. Despite the fall in the export of goods, the silver lining has been the increase in shipments of electronic goods from India, smart phones alone registering a growth of 65 per cent by volume and 162 per cent by value in 2022-23.

Question: My son who is in a reputed business school in India wants to specialize in software product management. He claims that this is a subject of prime importance at present. Is this so?

ANSWER: The demand for software product managers is increasing exponentially. Software product management is about ascertaining whether a software product is needed in this day and age and whether it will attract customers. For startups and new businesses, a clear understanding of the SPM process is necessary. It has been found that about 40 per cent of the products developed by startups were not acceptable to customers which resulted in closure of the start-ups. Technologists sometimes build products without assessing the customers’ needs. Many multinational companies are now appointing a software product manager on its executive board to ensure success of a new business. The demand for product management executives is as high as that for chartered accountants who are appointed from a risk management perspective. In fact, software management consultants command a higher remuneration than others. It is for this reason that business schools are now offering courses which are sought after by students who get immediate employment with companies upon graduation.

Question: Many e-pharmacies are cropping up in India. Do they have a licence to operate and are safeguards being provided by the Government to ensure that these pharmacies comply with all regulations?

ANSWER: Currently some of the e-pharmacies set up by well known corporates work with licensed pharmacies. Pharmaceutical companies have set up a procedure of checks and balances to ensure that e-pharmacies procure medicines only from their licensed distributors. The government is in the process of drafting a new legislation which will regulate the sale of online medicines. E-pharmacies have represented to the government that they are open to be audited to ensure that all transactions have been made only against valid prescriptions. They have submitted that digital platforms have a complete track and trace mechanism which would help regulators to audit any transaction which has been put through on their platform. They have agreed to extend a real time visibility process which would assist regulators to track every transaction. E-pharmacies have emphasised that every invoice in respect of medicines sold on their platform carries the signature of a licensed pharmacist.

H. P. Ranina is a practising lawyer, specializing in tax and exchange management laws of India.

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