India’s Commerce Minister Piyush Goyal has a clear message for Indian businesses: it’s time to look beyond the vast domestic market. He believes the allure of 1.4 billion consumers has created a ‘comfort zone,’ preventing companies from actively seeking global opportunities. This perspective comes at a crucial time, especially with concerns rising over the impact of high US tariffs on the Indian economy.
While acknowledging these challenges, Goyal urged India Inc not to be swayed by any ‘negative narrative.’ He pointed to India’s robust GDP growth, which accelerated to an impressive 7.8 percent in June. This figure, according to Goyal, serves as a ‘resounding response’ to critics and pessimists, including political opposition figures, economists, and certain media outlets.
Despite the specter of US tariff moves, Goyal exuded confidence that overall exports will continue to grow this year. He highlighted that a significant portion, over $46 billion of the $87 billion in exports to the US, remains unaffected by these tariffs. This resilience indicates a strong foundation for future trade.
“India is full of resilience, confidence and is raring to continue to be the fastest growing economy for the next 22 years,” Goyal declared. “India will continue to power on. Our exports will continue to grow, we will do higher exports this year than last year and the future is extremely bright.”
Speaking at an India-UAE Business interaction organized by the Confederation of Indian Industry (CII), Goyal candidly addressed the industry’s role. He reiterated his concern that the large domestic market, while a key driver of growth, has perhaps made businesses a little too comfortable. They make good profits at home but don’t venture out enough to explore global possibilities.
Goyal also highlighted deficiencies in value addition by Indian industries. He used striking examples: India sells rice but not rice puffs or ready-to-eat food products. Similarly, it’s an iron ore seller, but not a high-quality steel exporter. In the fashion industry, he lamented the scarcity of Indian clothing on high streets worldwide.
This is a call to action for India to brand itself differently on the global stage.
Prime Minister Narendra Modi, Goyal shared, has instructed him to ‘trust’ both businesses and people. The government is keen to collaborate with the industry to overcome obstacles and welcomes feedback. “Ask for help. Give us your support. Don’t lose out this opportunity. Put pressure on us,” he urged industry leaders. This open invitation shows a government ready to support its businesses in their global aspirations.
Regarding the US tariff impacts, Goyal stressed that President Donald Trump’s administration’s move shouldn’t deter Indian businesses. He called for everyone to ‘pull up their socks.’ The US has imposed a 50 percent tariff on Indian goods, affecting sectors like textiles and apparel, gems and jewellery, shrimp, and leather. This needs immediate attention and strategic responses.
He noted that the value addition in the Indian gems and jewellery sector is a low three to four percent. However, he acknowledged that significant effort will be needed to minimize the impact on textile and shrimp exports. This is where innovation and smart strategies will be key to maintaining export momentum.
In a proactive move, Goyal mentioned speaking with industrialist Noel Tata, who manages the popular Zudio and Westside chains. He requested Tata to consider purchasing goods impacted by US tariffs and selling them in the local market at a discount until alternative international markets can be secured. This shows a commitment to mitigating the immediate effects of trade disruptions.
Goyal declared that India always ‘shines in adversity.’ He pointed to several ongoing trade agreements the government is negotiating to diversify India’s trade basket. The 7.8 percent GDP growth, he emphasized, should serve as a significant ‘morale booster’ for the entire nation. This positive outlook is infectious and aims to inspire confidence.
Addressing those who ‘deride their own motherland,’ Goyal expressed disappointment. He suggested that such pessimists often fail to grasp fundamental economic principles, especially that export contribution in India is relatively low, as it’s primarily a domestically driven economy. This strong domestic market is the crucial comfort zone.
He affirmed the government’s unwavering commitment to reform and to doing everything necessary to spur further growth. Goyal expressed optimism about the upcoming GST Council meeting, anticipating ‘sane’ decisions that will further boost domestic demand. “I can promise you, you (industry) are all going to be immensely pleased after the GST Council meeting,” he added, hinting at positive outcomes.
Meanwhile, at the same event, UAE’s Minister for Foreign Trade, Thani bin Ahmed Al Zeyoudi, extended assurances of continued partnership. “No matter how the world and the partners are dealing with each other, and they’re changing their policies and changing their position against each other, the UAE and India will always be together,” he stated. This reinforces the strong bilateral ties between India and the UAE, offering a stable comfort zone within international trade relationships.
Ultimately, the message is clear: Indian businesses need to leverage their inherent strengths and the government’s support to confidently step out of their domestic comfort zone and conquer the global marketplace.