India had just become the world’s 6th largest economy by nominal GDP and overtakes France; I had talked about this in my last Blog, so you guys know how India did it.

So the question arises does Indian economy is a domestic-based economy? Most of the product which India produce is consumed domestically. To understand this let’s see what the domestic economy is, A local economy is referred to the internal market or domestic trading of goods and services. In shorts Goods and services is mostly traded within the country.

Many of you will oppose me as India is 21st in the world for exporting goods so why I am saying India is a domestic economy?

To understand let’s see this table

Rank Country Exports 1 China $2,157,000,000,000 2 European Union $1,929,000,000,000 3 USA $1,576,000,000,000 4 Germany $1,401,000,000,000 5 Japan $683,300,000,000 6 South Korea $577,400,000,000 7 France $551,800,000,000 8 Netherlands $526,400,000,000 9 Italy $499,100,000,000 10 Hong Kong $496,900,000,000 11 UK $436,500,000,000 12 Canada $433,000,000,000 13 Mexico $406,500,000,000 14 Singapore $372,900,000,000 15 Taiwan $344,600,000,000 16 Russia $336,800,000,000 17 Switzerland $336,800,000,000 18 UAE $314,700,000,000 19 Belgium $309,100,000,000 20 Spain $301,500,000,000 21 India $299,300,000,000

All figures is of year 2017

- CIA

As we can see in above table India’s rank is very poor, it is less than the countries which economy is almost half of India’s economy by GDP for e.g. Switzerland is ranked 17th and has GDP of 65,982.72 crores USD in 2016 compared to India 2.26 lakh crores USD in 2016. So with this example and table I wanted to show if a country GDP is so high then its exports should be high also. Now you can understand why I am calling India a domestic based economy. India is way back in terms of exports from top economies in world and this should be control in upcoming years. If you talk to any person who studied economics can say how vital is exports for a country, lacking export industries can cause imbalance in BOP.

So India lacks exports than to it had reached to the 6th largest economy in the world than just imagine with the exports level equal to France then the rank of India would be raised.

India doesn’t export it means it does not produce goods and services, most of products and services are used by the 1,354,739,997 people in the country and what left is shipped. To understand it let’s take an example India is exporting. Onions but due to rise in demand and finally raise in price force Govt. to impose an export ban on onion on 9th Seot.2017 to reduce prices and import onion from other countries to meet the demand. Although export ban has been withdrawn by the Govt. in 20th of Dec of the same year. It shows how India is poor to tackle the situation, and all this affects exports of a country.

To understand more let's divided into three parts, i.e., Agricultural, Manufacturing, and Service

Agricultural -

In this, I am going to talk about what is happening with agricultural products in India. During 2017-18 crop year, food grain production is estimated at 279.51 million tonnes, then to India have to import agricultural products from other countries, and this import stats keep on raising from last few years. Principal exports are Rice, and this is primarily made for the export purpose, and another agricultural product is consumed in India.

Manufacturing –

As you guys know India is not known for manufacturing of goods, most of the products which been made is consumed in country, and very few are exported, for, e.g., HERO motorcycle is manufactured in India, but India is consumer of most of the bike, world know companies either import their motorcycles or import and assemble in India.

Service –

The service sector is an exemption to Indian export scenario as it is performing very well in the past few years. Most of IT industry is goods and services is exported but still, the big fish like Google and Apple is still working outside, and India is still importing. Most of our products are used domestically.

The most important factor is our product is not recognized on a world scale, and it is not as cheap as China and not as good as USA and European, Indian products are just hovering in between. This is a big problem as per my point of view.

Due to technological advantages and other factors, Indian product is not able to face competition.

Indian big companies are not focusing on the Worldwide level it still focuses on Indian Market that’s why Indian companies cannot face competition on world level for, e.g., Splendor is a Motorcycle made with the aim of increase in mileage and lower the cost. Due to this, it loses the power of Motorcycle and style, And in the world that time people are crazy for speed and style, that’s why it only used domestically. This is just not a single product there are Variety of products which is made by Indian companies.

India also made some export-oriented products but those are very less, and some are seasonal like Mangoes, etc.