Gujarat, Maharashtra and Tamil Nadu top Niti's export preparedness index

First ever such index by Niti Aayog shows major regional disparities in infra, business environment & support

Industrially developed states like Gujarat, Maharashtra and Tamil Nadu have clinched the top rankings in the government’s new Export Preparedness Index, 2020.

Released on Wednesday, the index maps the export scenario in each state and ‘will help identify strategic recommendations for improving export competitiveness,’ according to the NITI Aayog. 

The central public think-tank has bet on the index heavily to provide critical insights into the challenges of the export process. Created over the past 12-15 months, the index will guide policy making in the export segment with an eye on achieving a $5-trillion economy within 2024, senior NITI Aayog officials said.

The index is based on a combination of four key pillars necessary for improving regional exports which were finalised after extensive discussions between the Centre and states, and carries individual weightages. 

Broadly, these are the trade policy of a state, assessment of ease of doing business and core infrastructure facilities along with specific export ecosystem, including the availability of trade support, and historical export performance that maps both growth and diversification.

It classifies states based on their geography, placing them under few major categories – coastal, landlocked, Himalayan, and union territories, city states. Overall, coastal states scored much higher than other categories in almost all sub-pillars such as export promotion policy, institutional framework, infrastructure, business environment, access to finance and export infrastructure. Only in research and development infrastructure did the union territories fare better.

Many Northeastern states under the ‘growth orientation’ sub-pillar were able to export more by focusing on their indigenous product basket. This shows that a focused development of such baskets (like spices) can drive exports and also improve farmer incomes.

The report flagged the major intra-and inter-regional disparities in export infrastructure, problems in trade support and lack of unique exports as the main challenges hampering export growth.