Twenty six States in India saw a decrease in gross value addition by their manufacturing sector, indicating the continued presence of impact of pandemic, the Niti Aayog said in its Export Preparedness Index 2022.

According to the report, some ten States have also reported a decrease in inflow of foreign direct investment (FDI).

Coastal States on top

For instance, Tamil Nadu is ranked one in the coastal category States. Amongst the Union Territories and small States, Haryana and Goa are ranked one; while the top spot among the Himalayan States goes to Uttarakhand.

The report points out that the coastal States have fared “the best” with some of them like Tamil Nadu, Maharashtra, Karnataka and Gujarat showing “exceptional performance”. In comparison, landlocked States have had a “satisfactory performance” with Uttar Pradesh and Haryana being the “positive outliers”. In case of States like Punjab and Telangana, “their regional advantages are untapped”.

Also read: Manufacturing sentiments remain positive in first quarter: FICCI survey

Himalayan States and Union Territories, barring four- Uttarakhand, Himachal Pradesh, Goa and Delhi, have reported “unsatisfactory performances” indicating the urgent need for reforms here.

“At the district level, 73 per cent have an export action plan in place and over 99 per cent are covered under the ‘One District One Product’ scheme...... States have a decent business environment with many States boasting of dedicated industrial presence, single-window clearance, and health export credit rates,” the report read adding that States have registered a positive growth rate in their exports over pre-pandemic levels.

Some 10-odd commodities account for 90 per cent of the exports; whereas 100 districts in the country account for nearly 87 per cent of the exports.

What to focus

The Niti Aayog report adds that States have lagged in transport connectivity. The absence of air connectivity hampers the movement of goods across regions, especially which are landlocked or geographically dis-advantaged.

Recommendations include diversification of export markets including tapping of GI products for export purposes. States should also identify other markets for their existing products, it added. Promoting high growth sectors like IT, automotive, textiles and renewable energy also enhances export competitiveness. Leveraging FTAs and improving data availability for exports have also been suggested.

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