Unit-4

Chapter-8:INTERNATIONAL TRADE


 EXERCISES

1. Choose the right answers of the following from the given options.

(i) Trade between two countries is termed as

(a) Internal trade (c) International trade

(b) External trade (d) Local trade

Ans: (c) International trade.

(ii) Which one of the following is a land locked harbour?

(a) Vishakhapatnam (c) Ennor

(b) Mumbai             (d) Haldia

Answer: (a) Vishakhapatnam.

(iii) Most of India’s foreign trade is carried through

(a) Land and sea (c) Sea and air

(b) Land and air (d) Sea

Answer:  (c) Sea and air.

2. Answer the following questions in about 30 words.

(i) Mention the characteristics of India’s foreign trade.

Answer: India's foreign trade boasts some distinct characteristics:

1. Dominated by Services: Services, particularly IT and software, account for over 50% of India's exports, highlighting its shift to a knowledge-based economy.

2. Merchandise Mix: Traditional exports like textiles and spices still hold strong, alongside new additions like engineering goods and pharmaceuticals.

3. Trade Deficit: Imports often outpace exports, leading to a persistent trade deficit. Factors like dependence on oil imports contribute to this gap.

4. Focus on Regional Trade: Free Trade Agreements (FTAs) with South Asian and ASEAN countries encourage regional trade, diversifying India's trading partners.

5. Evolving Trade Trends: E-commerce platforms and digital marketplaces are revolutionizing how Indian goods reach global markets.

(ii) Distinguish between port and harbour.

Answer: Both ports and harbors play crucial roles in maritime activities, but they have distinct functions:

Harbour:

*A sheltered body of water where ships find refuge and protection from storms and rough seas.

*Natural or man-made, often located near coasts or along rivers.

*Primarily used for anchoring and mooring ships.

*May offer basic facilities like fueling stations and repairs.

*Image of Harbour Opens in a new window.

Port:

*A facility within or adjacent to a harbor providing infrastructure for loading and unloading cargo and passengers.

*Usually man-made, with docks, warehouses, cranes, and other equipment.

*Focused on trade and transportation, connecting land and sea routes.

*Often serves as a hub for customs clearance, immigration, and logistics.

In simpler terms:

*Think of a harbor as a safe haven for ships, while a port is a bustling marketplace for maritime trade.

    Remember, every port needs a harbor, but not every harbor has a port.

(iii) Explain the meaning of hinterland.

Answer: Hinterland refers to the area inland or behind a coast, river, or city, economically tied to that central point. It can be:

*Land supplying resources to a port or city.

*Area served by a transportation network.

*Rural region linked to an urban center.

    Think of it as the "countryside" supporting the "city."

(iv) Name important items which India imports from different countries.

Answer: Here are some of the top imports India gets from different countries:

*Crude oil: Primarily from Saudi Arabia, Iraq, and the UAE.

*Diamonds: Mainly from Belgium, Switzerland, and the UAE.

*Electronic goods: Largely from China, South Korea, and Japan.

*Coal: Often from Indonesia, Australia, and South Africa.

*Gold: Typically from Switzerland, UAE, and Hong Kong.

*Machinery: Frequently from Germany, Japan, and South Korea.

*Chemicals: Often from China, the US, and Germany.

*Animal and vegetable oils: Typically from Malaysia, Argentina, and the UAE.

    Remember, this is a snapshot, and specific trade patterns can fluctuate.

(v) Name the ports of India located on the east coast.

Answer: From north to south, some key ports on India's east coast include:

*Visakhapatnam, Andhra Pradesh

*Paradip, Odisha

*Kolkata (Haldia), West Bengal

*Ennore, Chennai, Tuticorin - all in Tamil Nadu

*Port Blair, Andaman & Nicobar Islands

    These bustling hubs handle diverse cargo and play a crucial role in India's maritime trade.

3. Answer the following questions in about 150 words.

(i) Describe the composition of export and import trade of India.

Answer: India's export and import trade is a dynamic and evolving landscape, characterized by a fascinating mix of traditional and modern goods. Here's a glimpse:

Exports:

*Service-driven: Over 50% of India's exports come from services like IT, software, and business process outsourcing, highlighting its shift towards a knowledge-based economy.

*Diversified merchandise: Traditional gems and jewelry, textiles, and spices mingle with newer exports like engineering goods, pharmaceuticals, and chemicals.

*Agro-exports: Tea, rice, and marine products still play a significant role, showcasing India's agricultural prowess.

Imports:

*Fuel dependence: Crude oil dominates imports, often accounting for over 20%, leading to a trade deficit.

*Capital goods: Machinery and equipment for infrastructure development and manufacturing industries feature prominently.

*Raw materials: Gold, coal, and electronic components are essential imported items.

Trends to watch:

*Focus on regional trade: Free Trade Agreements with South Asian and ASEAN countries are boosting trade within the region.

*E-commerce boom: Digital platforms are revolutionizing how Indian products reach global markets.

Make in India: Emphasis on domestic manufacturing aims to reduce dependence on imports and increase exports of finished goods.

    While challenges like the trade deficit remain, India's diverse export and import composition reflects its evolving economic ambitions and potential for sustained growth.

(ii) Write a note on the changing nature of the international trade of India

Answer: Charting New Waters: The Changing International Trade of India

India's international trade is far from stagnant. It's a dynamic ocean undergoing fascinating transformations, driven by economic evolution, technological advancements, and global trends. Let's dive into some key shifts:

1. From Textiles to Tech:

*Goodbye, Jute Bags, Hello, Software Solutions: While traditional exports like textiles and spices still hold charm, they're increasingly accompanied by high-value goods like engineering goods, pharmaceuticals, and IT services. India's knowledge-based economy is taking center stage, with software exports exceeding 50% of total service exports.

2. Regional Trade Takes Root:

Looking East, Beyond West: India's trade gaze is no longer solely fixed on the West. Free Trade Agreements (FTAs) with South Asian and ASEAN countries are fostering closer regional ties, diversifying India's trading partners and creating exciting new avenues for economic cooperation.

3. E-commerce Charts a New Course:

Click, Buy, Ship Worldwide: The digital revolution has reached the high seas! E-commerce platforms are transforming how Indian products reach global markets, making it easier for small businesses and entrepreneurs to tap into international demand.

4. Green Trade Gains Momentum:

Sustainability Steers the Ship: Climate change concerns are influencing trade patterns. India is actively participating in initiatives like the International Solar Alliance, promoting the export of clean energy technologies and fostering a more sustainable future for international trade.

5. Trade Deficit: A Persistent Tide:

Bridging the Gap: Despite the overall growth, India still faces a trade deficit, with imports often outpacing exports. Reducing dependence on oil imports and promoting domestic manufacturing of high-value goods are crucial steps towards tackling this challenge.

    India's international trade is a voyage brimming with potential. By embracing these transformations and strategically navigating challenges, India can chart a course towards a prosperous and sustainable future on the global trade map.



Answer Type By: Himashree Bora.