This a short note on the figures mentioned in the [article]( https://www.linkedin.com/posts/subhash-garg-2241682_services-will-not-keep-bailing-out-india-activity-7254418110437367810-K3j9?utm_source=share&utm_medium=member_desktop) titled *[Services will not keep bailing out India’s merchandise exports forever](https://www-deccanherald-com.cdn.ampproject.org/c/s/www.deccanherald.com/amp/story/business%2Feconomy%2Fservices-will-not-keep-bailing-out-indias-merchandise-exports-forever-3242870)*, authored by **Subhash Chandra Garg is former Finance & Economic Affairs Secretary, and author of ‘The Ten Trillion Dream’ and ‘We Also Make Policy’.** 1. *Indian merchandise exports grew by only 1% in first six months of 2024-25.* Here total merchandise exports during April-Sept ofFY23-24 is compared with April-Sept of FY24-25. April-Sept of FY23-24 = US$211.08 billion April-Sept of FY24-25 = US$213.22 billion **% change = 1% approx.** 2. *Services exports did much better at 9.66% raising overall export growth to 4.86%* 1. Here total merchandise exports during April-Sept ofFY23-24 is compared with April-Sept of FY24-25. April-Sept of FY23-24= US$163.92 billion April-Sept of FY24-25= US$180.00 billion **% change = 9.10% approx.** 2. Total exports: April-Sept of FY23-24 = US$393.22 billion April-Sept of FY24-25 = US$375.00 billion **% change = 4.86% approx.** Source-https://www.commerce.gov.in/wp-content/uploads/2024/10/PIB-Release-2.pdf 3. *In five years of Modi 2.0, share of services exports has increased by more than 5%.  If this trend persists, services export will overtake merchandise exports by 2029* 1. **FY19-20** Total exports in April-Sept of FY19-20= US$267.21 billion Total services exports in April-Sept of FY19-24= US$107.63 billion **% share of services exports of this period (B) = 40.27%** [^1] 2. **FY24-25** Total exports in April-Sept FY24-25 = US$393.22 billion Total services exports in April-Sept FY24-25 = US$180.00 billion **% share of services exports of this period (A) = 45.78%** [^2] 4. **A-B is more than 5%** 5. If this trend persists, services export will overtake merchandise exports by 2029.* 1.05^(4 years from FY25-26 to FY28-29)=21.55%. So 21.55% of 180 (services exports in April-Sept of FY24-25) is 218 which is greater than 213.22 (merchandise exports in April-Sept of FY24-25) 6. China Plus One, also known simply as Plus One or C+1, is a strategy or a trend to encourage investments into manufacturing in other promising developing economies such as India, Thailand, Turkey or Vietnam. 7. *Services exports did exceedingly well, rising 9.66 per cent from $164.14 billion to $180 billion.* Here total services exports during April-Sept of FY23-24 is compared with April-Sept of FY24-25. 8. *Exports to China, our fourth largest export market in the first half of 2023-2024 with India exporting $7.63 billion of goods, recorded a degrowth of 9.35 per cent, downgrading China to fifth place, with exports declining to $6.91 billion. April-Sept FY23-24 = $7626.38 million April-Sept FY24-25 = $6913.20 million % change = 9.35% approx. Source - https://www.commerce.gov.in/wp-content/uploads/2024/10/Quick-Estimates-September-2024-2-2.pdf Path to the file: https://commerce.gov.in/trade-statistics > Latest Trade Figures > Quick Estimates for selected Major Commodities for October 2024 9. *India’s merchandise trade deficit of $49.38 billion with China during April-September 2024 constituted 41 per cent of the total trade deficit of ~~$119.24 billion~~ $137.44 billion.* Total Trade Deficit = $350662.39 million - 213222.29 million = $137.44 billion April-Sept FY23-24 = $6913.20 million - $56289.37 million = $49.38 billion **% share - ~~41%~~ 35.92%** Path to the file - Same as above. 10. *Apple contractors establishing a major production base in India resulting in India’s electronics exports growing handsomely ($15.64 billion in the first half of 2024-2025 against $13.06 billion in 2023-2024) recording growth of 19.74 per cent.* Total electronics exports: April-Sept FY23-24 = $13062.30 million = $13.06 billion April-Sept FY24-25 = $15640.51 million = $15.64 approx. Path to the file - Row 22 of Page 1 of the file above 11. *The government runs hundreds of [[Exports & The RBI#^3a66ee|export promotion schemes]] and spends billions of dollars promoting merchandise exports. Data tells you that it is unfortunately making no real difference.* >[!normal] > 1. Angus Maddison[1](https://rbi.org.in/scripts/BS_SpeechesView.aspx?Id=1074#F1) estimates that India and China were the world’s two largest economies until the early 18th century. > 2. China is the world’s largest economy today on PPP basis and India is the third largest. > 3. If you add up India’s exports and imports, the U.S. and sometimes China have been India's largest trading partners. > 4. India is world’s third largest economy today in PPP terms ## References 1. Subhash Chandra Garg. (2024, October 22). _Services will not keep bailing out India’s merchandise exports forever_. _Deccan Herald_. [Link](https://www.deccanherald.com/amp/story/opinion/services-will-not-keep-bailing-out-indias-merchandise-exports-forever-3242870) [^1]: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1588199 [^2]: https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1588199