India Set to Launch E-commerce Export Framework by September, Aims for Growth

A regulatory framework to enhance India's exports via e-commerce is expected by September, according to Commerce Secretary Sunil Barthwal. Currently, India's e-commerce exports stand at about USD 5 billion annually, compared to China's USD 300 billion. Barthwal highlighted the significant potential for growth in this sector.

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On Tuesday, a meeting was held with various departments, including revenue and industry representatives from logistics and marketplace platforms. Barthwal mentioned that the ministry is working on establishing e-commerce export hubs across the country. "We discussed its framework. It is in our 100-day agenda," he stated.

Potential Growth in E-Commerce Exports

Barthwal indicated that these hubs could help small producers sell to aggregators who will then find markets for their products. The framework aims to create a regulatory ecosystem for these hubs, which will be located near airports and ports. He added that the potential exists to increase e-commerce exports to USD 50-100 billion in the coming years.

Export products with high potential include jewellery, apparel, handicrafts, and ODOP (one district one product) goods. Barthwal noted that the industry is not seeking financial assistance but requires a robust regulatory ecosystem covering aspects like taxation and handling returned goods.

Support from Various Departments

The commerce ministry's arm DGFT is collaborating with the RBI and other ministries, including finance, to promote e-commerce exports. These hubs will facilitate export clearances and provide warehousing, customs clearance, returns processing, labelling, testing, and repackaging services.

Ajay Sahai, Director General of the Federation of Indian Export Organisations, stated that these hubs would act as bonded zones to facilitate e-commerce cargo exports and imports. This setup aims to address the issue of re-imports, which account for about 25% of e-commerce goods.

Future Prospects and Challenges

Last year, cross-border e-commerce trade was approximately USD 800 billion and is projected to reach USD 2 trillion by 2030. A report by economic think tank GTRI suggests that India's e-commerce exports could reach USD 350 billion by 2030. However, banking issues currently hinder growth and increase operational costs.

India has set an ambitious target of achieving USD 1 trillion in merchandise exports by 2030. Cross-border e-commerce trade has been identified as a key medium to help meet this goal.

The new framework will provide a structured approach to boost India's e-commerce exports significantly. With proper implementation, it can create numerous opportunities for small producers and contribute substantially to the country's export targets.