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India's surge in modern services exports: Empirics for policy

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  • Sahoo, Pravakar
  • Dash, Ranjan Kumar

Abstract

India's exports of modern services have grown consistently over the last three decades and more so since 1991. Sustaining modern services exports (MSEs), which in India enjoy comparative advantage, is important for sustaining service-led growth and maintaining stability on the external sector. In this context, we examine key drivers of India's surge in MSEs which have important implications for policy. The results reveal that endowment factors such as human capital, tele-density, financial development, physical infrastructure and institutions are the key drivers of India's MSEs along with the world demand, exchange rate and foreign direct investment. Therefore, India needs to focus on and speed up the ongoing reforms to improve supply side factors such as education, infrastructure, financial sector deepening, governance and broad-band tele-density to improve competitiveness of India's modern services exports.

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  • Sahoo, Pravakar & Dash, Ranjan Kumar, 2014. "India's surge in modern services exports: Empirics for policy," Journal of Policy Modeling, Elsevier, vol. 36(6), pages 1082-1100.
    • Handle: RePEc:eee:jpolmo:v:36:y:2014:i:6:p:1082-1100
    DOI: 10.1016/j.jpolmod.2014.10.006
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    3. Mamadou Bah & Henri Atangana Ondoa & Koffi Délali Kpognon, 2021. "Effects of governance quality on exports in Sub-Saharan Africa," International Economics, CEPII research center, issue 167, pages 1-14.
    4. Gnangnon, Sèna Kimm, 2020. "Aid for Trade and Services Export Diversification in Recipient-Countries," EconStor Preprints 210467, ZBW - Leibniz Information Centre for Economics.
    5. Gnangnon, Sèna Kimm, 2022. "The Least Developed Countries' Services Waiver and the Stability of Least Developed Countries' Services Exports," EconStor Preprints 260587, ZBW - Leibniz Information Centre for Economics.
    6. Sèna K. Gnangnon, 2021. "Aid for Trade and services export diversification in recipient countries," Australian Economic Papers, Wiley Blackwell, vol. 60(2), pages 189-225, June.
    7. Gnangnon, Sèna Kimm, 2020. "Effect of Poverty on Services Export Concentration in Developing Countries," EconStor Preprints 223178, ZBW - Leibniz Information Centre for Economics.
    8. Kant, Chander, 2016. "Are institutions in developing countries malleable?," Journal of Policy Modeling, Elsevier, vol. 38(2), pages 272-289.
    9. Radovan Kastratović, 2020. "The impact of foreign direct investment on host country exports: A meta‐analysis," The World Economy, Wiley Blackwell, vol. 43(12), pages 3142-3183, December.

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    More about this item

    Keywords

    India; Modern services exports; Human capital; Finance; Infrastructure;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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