Measures for Improving the Export of Uttarakhand :

In a dynamic economy both imports and exports play an important role in stimulating production and generating employment. The growth of the exports gained momentum during the last decade. Government initiatives in the form of subsidies to industries, quality industrial infrastructure and monetary and fiscal benefits as incentives to the investors have been played the key role for the growth of the exports of the state. The pattern of production has been shifted from traditional items to high tech products like electronics, computer and its accessories, tele-communication and processed food. In recent years, productivity and production of herbal and medicinal plants and their trade in the state have been increased drastically.

However, the hill region of the Uttarakhand largely represents a case of the closed economy. The regional specificities and constraints make it distinct from the other regions with limited possibility of exporting of goods and services barring the niche products in which it has comparative advantage. Manufacturing sector was not fully developed in Uttarakhand in spite of various initiatives like 100 percent excise exemption for ten years and 100 per cent exemption from income tax in the first five years of operations, and 30 per cent exemption from income tax in the next five years of operations. In addition, the state government has made provision of uninterrupted power to industrial units which are one of the most crucial factors for ensuring rapid industrial growth

In addition, in the hill regions of Uttarakhand are having advantage to produce agro-based product e.g. herbs, fruits, frozen tulsi, fruit juices, and jams, handicraft products and wooden items which are highly demanded at national level and abroad.  There are some steps need to be taken to improve the export of the state :

1. Commodity wise and source wise composition of the imports of Uttarakhand signifies a considerable diversity. However it would be in the interest of the state to reduce its dependence on imports by promoting indigenous industries.

2. The top ten industries roughly account for about 80 percent of the imports. Among the top ten industries happen to be: Machinery and Equipment, Motor Vehicles, Trailers and Semi-trailers, Rubber and Plastics Products, Electrical Equipment, Chemicals and Chemical Products, Basic Metals, Food Products, Computer, Electronic and Optical products. From this it is clear that Uttarakhand mainly imports industrial goods. This is also an indicator of the low industrial base of the state’s economy. It needs be increased so that dependence on imports is reduced.

3. The economy of Uttarakhand is well diversified in terms of destinations of exports. Its exports go to a vast number of countries outside India. Within India too exports of commodities are to a number of states. Of course certain regions occupy a higher share in the exports. A more complete analysis would require commodity wise destination of exports. There is also a need for export promotion.

4. After the introduction of GST regime the potential revenue stream from imports may also undergo a change. A high pace of economic growth in the state especially of industries producing a variety of industrial and consumer goods based on locally sourced material may reduce the dependence of state on imported goods.

5. To bring out the role of imports in state’s economy in more detail, construction of an Input- Output table and analysis should be taken up. This would also reveal the inter-industrial linkages.

6. Data on exports are not adequate; there is a need to augment them. Data on commodity composition of exports should be collected/ obtained. Export promotion Council of Uttarakhand may be involved in this task.

7. There must be a dedicated cell in the Directorate of Economic Statistics for tracking and analysing the trends in Imports and Exports of Uttarakhand. Trade statistics must be published in statistical publications of the department.

8. After switching over to the GST regime, there has to be a different method of collecting the data on imports by the commercial tax department and the National Informatics Centre. As things stand today, e-way bills and information through IGST may provide data on the imported commodities. However, NIC(National Informatics Centre) classification of commodities and the HSN(Harmonized System of Nomenclature) code of GST have to be harmonised for smooth flow of data.

Owing to hill specificity, the road is the dominant mode of trading of goods and services. Regional growth has been promoted typically by the ability of the region to produce goods and services that are demanded by the national economy and outside the national economy. The demand for the goods and services (derived from resources) must exhibit a high-income elasticity. The other important aspect is that the resources (or goods and services) must generate locationally forward and backward linkages in order to generate multiplier effects and create markets. To a large extent such linkages would depend upon how returns from the goods and services demanded by the outside region could generate active demand for regionally produced goods and services.