Gujarat tops NITI Aayog's Exports Index; beats TN, Maharashtra

Gujarat has emerged as the top-performing state in Niti Aayog's second edition of the Export Preparedness Index 2021, beating other coastal economic powerhouses such as Maharashtra and Tamil Nadu.

These three coastal states contributed around 60% to the country's exports in the financial year 2020-21.

Among landlocked states, Haryana emerged as a best performer followed by Uttar Pradesh, Madhya Pradesh, and Punjab.

States in the hilly terrains are still struggling to make a mark at the global export network, according to the Export Preparedness Index 2021.

Gujarat led export contribution in India with its total share accounting for 20.83% as of 2020-21. Maharashtra, the second largest exporter in the country with a 20.06% share, has facilitated export growth by focusing on initiatives such as Ease of Doing business and providing subsidies to SME units, the report stated.

The index, released by NITI Aayog vice chairman Rajiv Kumar, said Gujarat is now the largest producer of processed diamonds, and its total share in India's export of diamond stands at 80%. The state is also the country's chemicals, and petrochemicals hub and its total petroleum products exports as of 2020 is $17,972.08 million.

The state government has been concentrating on export promotion policies and has successfully designed a platform for the export-oriented units and companies to promote their products and reach a global audience, the report said.

"EPI 2021 will help the states and UTs in a long way to plan and execute sound export-oriented policies for ensuring a conducive export ecosystem, to make maximum utilization of their export potential," said Kumar.

The strong performance of coastal states contributed a 68% share in India's exports. As with Gujarat, the export share is 20.83%, and the lowest is in Kerala with 1.35%.

The total foreign direct investment (FDI) inflows to Gujarat stood at $21.89 billion as of FY21. Maharashtra, on the other hand, accounted for 28% of FDI inflows in the country.

Along with the increase in the FDI inflows, there is a correlation between a State’s Gross State Domestic Product with its export share in GSDP.

States with higher exports also experience a high Gross State Domestic Product (GSDP). $259.25 billion is the estimated GSDP of Gujarat in fiscal year 2022. Maharashtra's GSDP stood at $366.67 billion in 2020-21.

Both top-performing states have productively managed and expanded their port infrastructure on the coastal line. With 48 ports, Maharashtra has the highest number of ports in the country, followed by Gujarat with 42 ports.

The index ranks states and UTs on four main pillars—policy; business ecosystem; export ecosystem; export performance—and 11 sub-pillars—export promotion policy; institutional framework; business environment; infrastructure; transport connectivity; access to finance; export infrastructure; trade support; R&D infrastructure; export diversification; and growth orientation.

It aims to examine the export performance and the export readiness of the states and union territories. The idea behind the index is to create a benchmark to rank these states and UTs to enhance a sense of competition between states and encourage them to adopt export promotion policies

"The second edition of the index will be a significant catalyst for promoting competitive federalism and a fair contest among states and UTs in the global export landscape," said NITI Aayog CEO Amitabh Kant.