India’s Export Outlook

India’s Export Outlook for the Next Five Years

India’s exports are poised for robust growth, projected to reach US$1.4–1.6 trillion by FY 2029-30, doubling from US$820.93 billion in FY 2024-25. Goods exports, estimated at US$437.42 billion in 2024-25, are expected to hit US$800–900 billion, driven by electronics (US$150 billion), pharmaceuticals (US$50 billion), and engineering goods (US$200 billion). Services exports, at US$383.51 billion in 2024-25, may reach US$600–700 billion, led by IT services (US$300 billion) and business services (US$150 billion). Tamil Nadu, Karnataka, and Telangana are emerging as export powerhouses, fueled by electronics and IT. Competitive strengths include low-cost manufacturing, a skilled IT workforce, and government initiatives like PLI schemes and FTAs. However, global trade volatility, import dependence, and infrastructure gaps pose risks. Strategic investments in AI, biosimilars, and tourism, alongside FTAs with the UK and EU, will unlock opportunities in the US, Africa, and Southeast Asia.

Historical Context and Current Performance

India’s export journey reflects resilience and ambition. In FY 2014-15, total exports were US$465.9 billion (goods: US$310.3 billion; services: US$155.6 billion). By FY 2018-19, they grew to US$538.1 billion (goods: US$330.1 billion; services: US$208 billion). In FY 2024-25, exports reached US$820.93 billion (goods: US$437.42 billion; services: US$383.51 billion), a 76.2% increase from 2014-15. “India’s export growth has outpaced many peers, driven by services and targeted manufacturing policies,” says Arvind Panagariya, former NITI Aayog Vice Chairman (World Bank, 2024).

Goods Exports: Electronics surged by 560% from FY 2014-15 (US$5.9 billion) to FY 2024-25 (~US$38.9 billion), fueled by PLI schemes. Pharmaceuticals grew 86% to US$27.9 billion, with India supplying 50% of Africa’s generics. “The PLI scheme has transformed India into an electronics hub,” notes Ajay Sahai, FIEO Director General (FIEO, 2023). Engineering goods (US$117.6 billion) and gems/jewelry remain strong, though mineral fuels (US$75.4 billion) declined 15.6% from 2023 to 2024.

Services Exports: Services exports nearly doubled from US$208 billion in FY 2018-19 to US$383.51 billion in FY 2024-25. IT services, contributing ~50%, grew 90% since 2014-15. “India’s IT sector is a global leader, leveraging a skilled workforce and digital infrastructure,” says NASSCOM President Debjani Ghosh (NASSCOM, 2024). Business services (~US$100 billion) and travel services also thrive, with the latter boosted by a 10.35% rise in domestic airline passengers in FY 2024-25.

Competitive Strengths

India’s export edge lies in:

1. Cost-Competitive Manufacturing: Low labor costs and PLI schemes make electronics and pharmaceuticals globally competitive. “India’s cost advantage is unmatched in generics and electronics assembly,” says GTRI’s Ajay Srivastava (GTRI, 2024).
2. Skilled IT Workforce: With 5 million IT professionals, India dominates 20% of global IT outsourcing (IBEF, 2025). “Our software talent is a global asset,” notes Infosys CEO Salil Parekh.
3. Policy Support: PLI schemes (US$24 billion allocated) and SPI for pharmaceuticals drive growth. “PLI is a game-changer for manufacturing,” says Commerce Minister Piyush Goyal (Ministry of Commerce, 2024).
4. Strategic FTAs: Agreements with UAE, Australia, and upcoming deals with the UK and EU enhance market access. “FTAs will open new markets,” predicts Exim Bank’s Harsha Bangari (Exim Bank, 2024).
5. Digital Infrastructure: 5G rollout and UPI expansion bolster IT and financial services exports. “India’s digital leap is fueling services growth,” says RBI Governor Shaktikanta Das (RBI, 2024).

Growth Drivers and Opportunities (2025–2030)

Goods Exports:

• Electronics: Projected to reach US$150 billion by 2030, driven by PLI and global demand for smartphones. “India could capture 10% of global electronics trade,” says Deloitte’s Peeyush Gupta (Deloitte, 2025).
• Pharmaceuticals: Expected to hit US$50 billion, with biosimilars and APIs as growth areas. “India’s generic drug dominance will expand into biologics,” notes PwC’s Rahul Renavikar (PwC, 2024).
• Engineering Goods: Forecasted at US$200 billion, supported by FTAs and global supply chain shifts. “Engineering exports will benefit from China+1 strategies,” says EEPC’s Arun Garodia (EEPC, 2024).

Services Exports:

• IT Services: Projected to reach US$300 billion, driven by AI, cloud computing, and cybersecurity. “AI will redefine India’s IT exports,” says TCS CEO K Krithivasan (TCS, 2025).
• Business Services: Expected to grow to US$150 billion, with 1,600+ global capability centers by 2024. “GCCs are India’s new export engine,” notes EY’s Rajiv Memani (EY, 2024).
• Travel Services: Forecasted at US$60 billion, boosted by medical and cultural tourism. “Medical tourism is a US$10 billion opportunity,” says Apollo Hospitals’ Prathap Reddy (IBEF, 2025).

State-Level Growth:

• Tamil Nadu: Electronics exports grew 77% to US$9.6 billion in FY 2023-24. “Tamil Nadu is India’s electronics export capital,” says CM M.K. Stalin (Tamil Nadu Government, 2024).
• Karnataka: IT exports dominate, with Bengaluru contributing ~40% of India’s IT revenue. “Bengaluru’s tech ecosystem is world-class,” says Karnataka IT Minister Priyank Kharge (NASSCOM, 2024).
• Telangana: Hyderabad’s IT and pharma hubs drive ~70% services export growth since 2014-15. “Hyderabad is a global IT destination,” says Telangana IT Minister K.T. Rama Rao (Telangana Government, 2024).

Key Markets

Current (FY 2024-25):

• United States: US$80.4 billion (18.3%), led by pharmaceuticals and IT.
• UAE: US$37.2 billion (8.5%), driven by petroleum and gems.
• Netherlands: US$24.5 billion (5.6%), strong in electronics.
• Africa: Growing demand for pharmaceuticals (50% of generics) and IT services.
• Southeast Asia: Malaysia and Indonesia for electronics and IT.

Future (by 2030):

• Africa: Tanzania’s threefold export growth in FY 2023-24 signals potential. “Africa is India’s next big market,” says CII’s Chandrajit Banerjee (CII, 2024).
• Latin America: Brazil and Mexico for pharmaceuticals. “Latin America offers untapped potential,” notes Pharmexcil’s Uday Bhaskar (Pharmexcil, 2024).
• EU and UK: FTAs will boost textiles, IT, and pharmaceuticals. “The UK FTA could add US$10 billion annually,” says NITI Aayog’s Suman Bery (NITI Aayog, 2025).

Forecast for FY 2029-30

India’s exports are targeted at US$2 trillion by 2030 (US$1 trillion goods, US$1 trillion services). By FY 2029-30, exports are projected at:

• Goods: US$800–900 billion, with electronics (US$150 billion), pharmaceuticals (US$50 billion), and engineering goods (US$200 billion).
• Services: US$600–700 billion, led by IT (US$300 billion) and business services (US$150 billion). “India can achieve US$2 trillion if it leverages FTAs and digital innovation,” says GTRI’s Ajay Srivastava (GTRI, 2024). Growth will hinge on PLI, FTAs, and supply chain diversification.

Threats to India’s Export Journey

1. Global Trade Volatility: Geopolitical tensions and US-China trade wars could disrupt demand. “Global uncertainties are a major risk,” warns World Bank’s Martin Rama (World Bank, 2024).
2. Import Dependence: Electronics rely on imported components (70% of inputs). “Supply chain bottlenecks could derail growth,” says IBEF’s Rajesh Nath (IBEF, 2025).
3. Infrastructure Gaps: Logistics costs (14% of GDP) are higher than competitors. “Infrastructure upgrades are critical,” notes ADB’s Yasuyuki Sawada (ADB, 2024).
4. Trade Barriers: Non-tariff barriers in the EU and US could hit pharmaceuticals. “Regulatory hurdles are a challenge,” says IPA’s Sudarshan Jain (IPA, 2024).
5. Competition: China and Vietnam challenge India in electronics and textiles. “Vietnam’s export growth is a wake-up call,” says FIEO’s Ajay Sahai (FIEO, 2023).

Strategic Requirements

• Diversify Markets: Target Africa, Latin America, and Southeast Asia to reduce reliance on the US and EU.
• Invest in Innovation: Boost R&D in AI, biosimilars, and 5G to stay competitive.
• Reduce Import Dependence: Expand domestic API and electronics component production.
• Enhance Logistics: Cut logistics costs to 10% of GDP through infrastructure upgrades.
• Leverage FTAs: Fast-track UK and EU agreements to boost market access.

India’s Export Outlook: 2025–2030

Historical Performance

Year	Goods Exports (US$ Billion)	Services Exports (US$ Billion)	Total Exports (US$ Billion)
FY 2014-15	310.3	155.6	465.9
FY 2018-19	330.1	208.0	538.1
FY 2024-25	437.42	383.51	820.93
FY 2029-30	800–900	600–700	1400–1600

Competitive Strengths

• Cost-Competitive Manufacturing: Low labor costs and PLI schemes.
• Skilled IT Workforce: 5 million professionals, 20% of global IT outsourcing.
• Policy Support: US$24 billion in PLI and SPI schemes.
• Strategic FTAs: UAE, Australia, and upcoming UK/EU deals.
• Digital Infrastructure: 5G and UPI expansion.

Key Growth Categories

Goods:

1. Electronics: US$150 billion by 2030 (560% growth since 2014-15).
2. Pharmaceuticals: US$50 billion, driven by generics and biosimilars.
3. Engineering Goods: US$200 billion, supported by FTAs.

Services:

1. IT Services: US$300 billion, fueled by AI and cloud computing.
2. Business Services: US$150 billion, driven by GCCs.
3. Travel Services: US$60 billion, boosted by medical tourism.

Fastest-Growing States

• Goods: Tamil Nadu (electronics), Haryana, Telangana (pharma).
• Services: Karnataka, Tamil Nadu, Telangana (IT and business services).

Key Markets

• Current: US (18.3%), UAE (8.5%), Netherlands (5.6%).
• Future: Africa, Latin America, Southeast Asia, EU (via FTAs).

Reflection

India’s export trajectory is a story of ambition tempered by challenges, with a clear path to becoming a global trade powerhouse by 2030. The projected doubling of exports to US$1.4–1.6 trillion by FY 2029-30 reflects India’s ability to capitalize on its competitive strengths: a cost-effective manufacturing base, a world-class IT workforce, and proactive policies like PLI and FTAs. Electronics and pharmaceuticals, driven by Tamil Nadu and Telangana, are transforming India into a manufacturing hub, while Karnataka and Hyderabad lead in IT and business services. “India’s export potential is immense, but execution is key,” warns NITI Aayog’s Suman Bery (NITI Aayog, 2025). The focus on AI, biosimilars, and medical tourism positions India to capture high-value markets, particularly in Africa and Southeast Asia.

Yet, threats loom large. Global trade volatility, fueled by geopolitical tensions, could disrupt demand, as seen in the 15.6% decline in mineral fuel exports in 2024. Import dependence for electronics components (70%) risks supply chain disruptions, while high logistics costs (14% of GDP) erode competitiveness. “Infrastructure and supply chain resilience are non-negotiable,” says ADB’s Yasuyuki Sawada (ADB, 2024). Competition from Vietnam and China, especially in electronics and textiles, demands urgent innovation. India must also navigate trade barriers in the EU and US, particularly for pharmaceuticals, where regulatory hurdles could slow growth.

The path forward lies in strategic diversification and investment. Expanding into Africa, Latin America, and Southeast Asia reduces reliance on traditional markets like the US. Investing in domestic API production and AI-driven IT services will bolster resilience. “India’s digital and pharma sectors are its trump cards,” notes PwC’s Rahul Renavikar (PwC, 2024). Fast-tracking FTAs with the UK and EU, alongside infrastructure upgrades, will unlock new opportunities. By addressing these challenges, India can not only meet its US$2 trillion target by 2030 but also redefine its place in global trade, balancing ambition with pragmatism.

References

1. World Bank. (2024). India’s Trade Outlook Report.
2. FIEO. (2023). Annual Export Analysis.
3. NASSCOM. (2024). India IT Industry Report.
4. GTRI. (2024). India’s Trade Dynamics.
5. IBEF. (2025). India Export Potential 2030.
6. Ministry of Commerce. (2024). PLI Scheme Impact Report.
7. Exim Bank. (2024). India’s Export Markets.
8. RBI. (2024). Annual Economic Report.
9. Deloitte. (2025). India Electronics Market Forecast.
10. PwC. (2024). Pharma Industry Outlook.
11. EEPC. (2024). Engineering Exports Report.
12. TCS. (2025). AI and IT Services Outlook.
13. EY. (2024). Global Capability Centers in India.
14. CII. (2024). Africa Trade Potential.
15. Pharmexcil. (2024). Pharma Export Strategy.
16. ADB. (2024). Asia Trade and Logistics Report.
17. IPA. (2024). Pharmaceutical Trade Challenges.
18. Tamil Nadu Government. (2024). State Export Report.
19. Telangana Government. (2024). IT and Pharma Exports.
20. NITI Aayog. (2025). India’s Trade Vision 2030.

Appendix: Definitions of India’s Service Export Categories

1. Software and IT Services

Definition: This category encompasses the export of software development, IT consulting, software maintenance, cloud computing services, and IT-enabled services (ITES) such as data analytics, cybersecurity, and artificial intelligence (AI) solutions. It includes custom software design, application development, and IT outsourcing for global clients.

Scope and Significance:

• Components: Software development (e.g., enterprise applications, mobile apps), IT consulting, system integration, cloud services, and emerging technologies like AI, machine learning, and blockchain.
• Contribution: Accounts for ~50% of India’s services exports (~US$190 billion in FY 2024-25). India holds a 20% share in global IT outsourcing, driven by companies like TCS, Infosys, and Wipro.
• Key Drivers: A skilled workforce of 5 million IT professionals, cost competitiveness (30–50% lower than Western markets), and robust digital infrastructure (e.g., 5G rollout). “India’s IT sector is a global powerhouse, leveraging talent and innovation,” says NASSCOM President Debjani Ghosh (NASSCOM, 2024).
• Markets: US (40% of IT exports), UK, EU, and emerging markets like Southeast Asia and Africa.
• Growth Outlook: Projected to reach US$300 billion by FY 2029-30, driven by AI adoption and cloud computing. “AI will redefine India’s IT exports,” notes TCS CEO K Krithivasan (TCS, 2025).

2. Business Services

Definition: Business services include professional and management consulting, technical services, research and development (R&D), and outsourcing services provided by global capability centers (GCCs). This category covers business process outsourcing (BPO), knowledge process outsourcing (KPO), and other high-value services like data analytics and legal process outsourcing.

Scope and Significance:

• Components: Consulting (e.g., strategy, HR), GCC operations, BPO (e.g., customer support, HR outsourcing), KPO (e.g., market research, financial analysis), and R&D services.
• Contribution: ~US$100 billion in FY 2024-25, with 1,600+ GCCs in India (e.g., Accenture, IBM). Growth of ~100% since FY 2014-15.
• Key Drivers: India’s 1,600 GCCs employ over 1.5 million professionals, offering cost savings of 40–60% compared to developed markets. “GCCs are India’s new export engine,” says EY’s Rajiv Memani (EY, 2024).
• Markets: US, EU, Middle East, and emerging regions like Latin America.
• Growth Outlook: Expected to reach US$150 billion by FY 2029-30, fueled by demand for high-value analytics and R&D services. Investments in PLI for IT hardware and relaxed regulations for SMEs will drive growth.

3. Travel Services

Definition: Travel services encompass revenue from foreign visitors to India for tourism, business, education, or medical purposes. This includes spending on accommodation, transportation, and cultural activities, as well as medical tourism (e.g., affordable healthcare services).

Scope and Significance:

• Components: Leisure tourism, business travel, educational travel, and medical tourism (e.g., surgeries, wellness treatments).
• Contribution: Significant growth post-COVID, with ~30% increase from FY 2018-19 to FY 2024-25. Domestic airline passenger growth (10.35% in FY 2024-25) supports this sector.
• Key Drivers: India’s rich cultural heritage, affordable healthcare (20–30% of Western costs), and growing global mobility. “Medical tourism is a US$10 billion opportunity,” says Apollo Hospitals’ Prathap Reddy (IBEF, 2025).
• Markets: US, UK, Southeast Asia, Middle East, and Africa.
• Growth Outlook: Projected to reach US$60 billion by FY 2029-30, driven by medical tourism and infrastructure upgrades (e.g., new airports, tourism circuits). Investments in hospitality and healthcare will enhance competitiveness.

4. Financial Services

Definition: Financial services exports include cross-border banking, insurance, payment processing, and fintech services. This category covers remittances, digital payment solutions (e.g., UPI-based services), and financial consulting for international clients.

Scope and Significance:

• Components: Banking services (e.g., cross-border transactions), insurance (e.g., reinsurance), fintech solutions, and financial advisory.
• Contribution: ~20% growth from FY 2018-19 to FY 2024-25, driven by India’s digital payment ecosystem and fintech innovation.
• Key Drivers: India’s UPI handles 50% of global digital transactions by volume, and fintech startups (e.g., Razorpay, Paytm) are expanding globally. “India’s digital payments are a global model,” says RBI Governor Shaktikanta Das (RBI, 2024).
• Markets: US, UK, Southeast Asia, and Middle East.
• Growth Outlook: Expected to grow at 8–10% annually, reaching ~US$50 billion by FY 2029-30. Expansion of UPI internationally and fintech partnerships will drive growth.

5. Communication Services

Definition: Communication services include telecommunications, postal, courier, and digital communication services (e.g., VoIP, data transmission). This category covers services provided by Indian telecom firms to global clients and digital infrastructure support.

Scope and Significance:

• Components: Telecom services (e.g., 5G networks, VoIP), postal/courier services, and digital communication platforms.
• Contribution: ~15% growth since FY 2018-19, driven by 5G rollout and digital infrastructure expansion.
• Key Drivers: India’s 1.2 billion mobile subscribers and 5G adoption (launched in 2022) enhance global connectivity. “5G is transforming India’s telecom exports,” says Reliance Jio’s Mukesh Ambani (Reliance, 2024).
• Markets: Southeast Asia, Africa, and Middle East.
• Growth Outlook: Projected to grow at 5–7% annually, reaching ~US$30 billion by FY 2029-30. Investments in 5G and satellite communication will bolster this sector.

References

1. NASSCOM. (2024). India IT Industry Report.
2. EY. (2024). Global Capability Centers in India.
3. IBEF. (2025). India Export Potential 2030.
4. RBI. (2024). Annual Economic Report.
5. TCS. (2025). AI and IT Services Outlook.
6. Reliance. (2024). Telecom Industry Outlook.