The value of India’s e-commerce exports, which are presently worth $1 billion per year, is expected to rise to $400 billion in the next six to seven years, according to Santosh Kumar Sarangi, director general of international trade.
Speaking at a FICCI conference, Sarangi said that the expected rise in e-commerce exports would help the nation attain $2 trillion in goods and services exports by 2030.
He predicted that worldwide cross-border e-commerce, which is presently worth roughly $800 billion per year, would reach $2 trillion by 2030.
“It shows the potential this sector holds for a country like India where product diversity and innovation is immense, and the ability of our entrepreneurs to gauge the requirements of specific markets and customize their products to cater to these markets is also huge,” Sarangi said.
However, he believes that for India to fulfill its full potential in terms of e-commerce exports, a significant shift in thinking and several regulatory adjustments are necessary.
“The entire orientation for the export ecosystem was modeled on a B2B shipment of goods through air, and ships, which needs to change (to cater to e-commerce exporters),” he added.
The goods trade imbalance in India reached a new high in October, owing to a surge in gold imports over the festival season and a higher oil bill, despite an increase in exports year on year.
According to figures from the Ministry of Commerce and Industry, the trade imbalance increased to $31.46 billion last month, with imports totaling $65.03 billion and exports totaling $33.57 billion.
The federal government is anticipated to release a comprehensive e-commerce strategy that will challenge the country’s e-commerce environment shortly.
Commerce Minister Piyush Goyal recently said in an official statement that the policies and guidelines were developed after extensive consultation with all stakeholders.
Meanwhile, Sarangi said that e-commerce players have requested that the Department of Promotion of Industry and Internal Trade (DPIIT) reconsider the FDI policy on inventory-based online trade and exports.
While India’s FDI policy currently prohibits foreign direct investment in the inventory-based model of e-commerce, it does allow FDI in enterprises operating on a marketplace model.
In terms of the various steps taken by the government to promote e-commerce exports, Sarangi stated that the DGFT is working with relevant stakeholders on issues such as exploring a ‘composition levy scheme’ for smaller e-commerce players to waive off mandatory GST until they reach a certain scale in exports, working with the RBI and Indian banking association to streamline the process of export credit availability, and striking off payment receivables on returned goods.
He said that the DGFT is collaborating with the Department of Post to enhance and develop Dak Niryat Kendras and foreign post offices (FPOs).
He also said that the DGFT is collaborating with postal services in the United States and other nations to establish a complete online tracking system for e-commerce export consignments.