India's trade policy has been a topic of widespread debate, especially in the Asian region. India's primary objective is that the country wants to increase its share of global trade in the coming years. At the same time, the South Asian nation also adopts various protectionist policies wherever it deems suitable. This article discusses the key pros and cons of India's trade policy.
The Pros
The most significant advantage of India's trade policy is that the country is continuously aiming to expand its trade relations with the rest of the world. This presents an excellent opportunity for traders from other countries that are interested in Indian products and services. The South Asian economy has opened up to a great extent recently. This has allowed for a sharp rise in its exports and imports. Secondly, another advantage of India's trade policy is that the country provides easy access to a large population base. India does not deter foreign players from engaging with its vast population, unlike China. India's open business environment makes it much easier for international traders to consider the country. These two pros indicate that international traders cannot afford to ignore the Indian market.
The Cons
At the same time, there are also a couple of cons when it comes to doing trade with India. The first issue is that the country's trade policy continues to place massive tariffs on certain products. Take the example of automobiles and related products. The degree of tariffs that are levied on these products can make it very hard for traders to generate a profit from the Indian market, irrespective of its population base. Secondly, another disadvantage of India's trade policy is that the country continues to cater to its domestic market first. Whenever there is a shortage in the local market, the country is quick to ban exports of certain products. Such bans can often prove to be very harmful to traders. These two cons indicate that the Indian trade policy is far from perfect, and there is still a long way to go.
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