EXPORT PREPAREDNESS INDEX FOR 2021

EXPORT PREPAREDNESS INDEX FOR 2021

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March 30, 2022 - 12:01 pm

NITI Aayog Releases Second Edition of EPI 2021


     NITI Aayog, in partnership with the Institute of Competitiveness, released the second edition of the Export Preparedness Index (EPI) 2021. EPI 2021 entails 4 pillars, 11 sub-pillars and 60 indicators and covers across 28 states and 8 UTs. As per the index, Gujarat emerged as the top-performing state in the 'Coastal States' category, followed by Maharashtra and Karnataka. In the category of 'Landlocked States,' Haryana was the best-performing state. Among 'Himalayan States' and 'Union Territories,' Uttarakhand and Delhi are the top-performing states respectively.

       The report is a comprehensive analysis of India’s export achievements. The index can be used by states and union territories (UTs) to benchmark their performance against their peers and analyse potential challenges to develop better policy mechanisms to foster export-led growth at the subnational level.

       The EPI prepared by Niti Aayog in partnership with the Institute of Competitiveness (IFC) ranked 36 states, city-states and union territories on the basis on policy (export promotion and institutional framework), business ecosystem (business environment, infrastructure, transport connectivity and access to finance), export ecosystem (export infrastructure, trade support and R&D infrastructure), and export performance (growth and orientation and export diversification). The index – a benchmark of the performance of states and UTs against their peers, is used to assess potential challenges as well as promote favourable environment for exports.

          EPI 2021 brings out three major challenges to India’s export promotion. These are intra- and inter-regional differences in export infrastructure; weak trade support and growth orientation across states; and lack of R&D infrastructure to promote complex and unique exports. The EPI’s primary goal is to instil competition among all Indian states (‘Coastal’, ‘Landlocked’, ‘Himalayan’, and ‘UTs/City-States’) to bring about favourable export-promotion policies, ease the regulatory framework to prompt subnational export promotion, create the necessary infrastructure for exports, and assist in identifying strategic recommendations for improving export competitiveness. It promotes competitive federalism and a fair contest among States/UTs. 

          The existence of a favourable trade policy in a region forms the basis for the strategic advantage to the stakeholders and provide a vision of the state government. The pillar covers the paramount trade policies vital for the expansion of export business. It evaluates whether the particular policy has been implemented in the state or not. A conducive eco-system with regulatory ease and a facilitative environment spurs business activity. This pillar tries to capture the performance of the states on similar grounds. The existence of efficient business ecosystem strengthens the backward and forward linkages of the exporting industry, thereby enhancing their output and growth. It covers a wide range of areas like Ease of Doing Business, Innovative Capacity, Cluster strength, Financial Ability, Logistics and more. In addition to the comprehensive enabling environment in the state, special attention must be given to the export business ecosystem, which drives competition and growth in the export-specific sector. The pillar covers indicators like area under Export Promotion Industrial Parks, Export Promotion Zones, Existence of Trade Guide, Number of Inspection agencies - NABCB certification and others, which are essential to attract new investors and increase the productivity of the existing ones. Measuring export performance is necessary to assess actual results. This particular pillar, unlike others, is an output-based dimension. It helps to examine how much the states have achieved and improved in the export sector. Growth and diversification of exports constitute the export performance of the states.

          The index can be a valuable tool for the government and policymakers in encouraging healthy competition among states and UTs, hence enhancing India’s standing in the global export market.


Questions and Answers Questions and Answers

Question : Who released the second edition of the Export Preparedness Index?
Answers : NITI Aayog
Question : How many UTs are covered in the Export Preparedness Index?
Answers : 8
Question : What state emerged as the top performing state in the Coastal States category?
Answers : Gujarat
Question : What is the EPI 2021 report?
Answers : Comprehensive analysis of India s export achievements
Question : What is the EPI used by states and Union Territories to do?
Answers : Benchmark their performance against their peers
Question : How many states did the EPI rank on the basis of policy export promotion and institutional framework?
Answers : 28
Question : What is the EPI used to assess potential challenges?
Answers : Favourable environment for exports
Question : What index entails 4 pillars, 11 subpillars and 60 indicators?
Answers : EPI 2021
Question : What are the three major challenges to India's export promotion?
Answers : intra- and inter-regional differences in export infrastructure; weak trade support and growth orientation across states; and lack of R&D infrastructure to promote complex and unique exports.
Question : What type of exports does the EPI's primary goal consist of?
Answers : The primary goal of the EPI is to create competition among all Indian states ('Coastal', 'Landlocked', 'Himalayan' and 'Union Territories/City-States').The primary goal of the EPI is to create competition among all Indian states ('Coastal', 'Landlocked', 'Himalayan' and 'Union Territories/City-States').
Question : What does the EPI promote?
Answers : Competitive federalism
Question : What is the basis for the strategic advantage to the stakeholders?
Answers : Favourable trade policy
Question : What is a conducive ecosystem with?
Answers : A conducive eco-system with regulatory ease and a facilitative environment spurs business activity
Question : What does the pillar of the EPI try to do?
Answers : Capture the performance of the states on similar grounds
Question : What strengthens the backward and forward linkages of the exporting industry?
Answers : Efficient business ecosystem
Question : What are some of the areas covered by the EPI?
Answers : Ease of Doing Business, Innovative Capacity, Cluster strength, Financial Ability, Logistics and more
Question : What drives competition and growth in the export specific sector?
Answers : Export business ecosystem
Question : What are some indicators that are essential to attract new investors and increase the productivity?
Answers : Industry Promotion Industrial Parks, Export Promotion Zones, Existence of Trade Guide, Number of Inspection agencies NABCB certification
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