A background note can be accessed here: NITI Aayog’s Export Preparedness Index
The Export Preparedness Index (EPI)’s classification of states as Leaders, Challengers, and Aspirers aims to inform targeted interventions. In what concrete ways can this subnational benchmarking be operationalised to move states from aspiration to demonstrable export outcomes, rather than remaining a descriptive scoreboard?
The EPI’s real utility lies in enabling targeted action rather than ranking states for comparison. Export performance today is shaped less by administrative boundaries and more by how districts and production clusters connect to regional and global supply chains. Interpreted this way, the index can help diagnose where specific frictions lie – logistics bottlenecks, inadequate testing and standards infrastructure, limited access to working capital, or weak firm capabilities – and direct policy attention accordingly.
One practical approach is to link EPI outcomes with district-level export diagnostics for a limited set of priority value chains aligned with India’s export strategy. Evidence suggests export gains are strongest when the most binding constraint is addressed, rather than through broad reforms. Aspirer states may need to prioritise basic trade facilitation, utilities, and compliance infrastructure; Challengers can focus on strengthening supplier networks and attracting anchor investors; Leaders should concentrate on value upgrading and market diversification. Without such differentiation, and without aligning export planning with investment facilitation, the EPI risks remaining descriptive rather than becoming a driver of export outcomes.
EPI 2024 introduces refined indicators for cost competitiveness, financial access, and MSME ecosystem strength. How should policymakers integrate these structural dimensions into national export strategy to mitigate global shocks and strengthen India’s participation in global value chains?
The expanded focus in EPI 2024 on cost competitiveness, access to finance, and MSME ecosystem strength is timely in an era of global uncertainty. Recent disruptions have shown that export success depends not only on price and productivity, but also on reliability, speed, and resilience. Economies that can meet standards consistently and absorb shocks are better positioned within global value chains.
For India, EPI insights should inform national export strategy beyond headline targets. Logistics efficiency, predictable border processes, and risk-sharing mechanisms – particularly for MSMEs – are critical to sustaining exports during downturns. Export credit, supply-chain finance, and cluster-based infrastructure should be treated as macro-stabilising tools rather than narrow sectoral support. The investment dimension is equally important: sustained competitiveness requires continuous upgrading in technology, quality, and compliance, especially as India positions itself within “China-plus-one” strategies. Trade and investment policy must therefore operate in tandem, with the EPI helping identify where this linkage is weakest and where corrective action is most urgent.
The index underscores regional disparities in export readiness and identifies gaps in infrastructure and trade support systems. What mechanisms are necessary to ensure that export growth contributes to inclusive employment and productivity gains rather than uneven benefits across regions and sectors?
As India targets a USD 1-trillion export economy, the central issue is not only export volumes but participation. The EPI highlights uneven export readiness across regions, driven by disparities in infrastructure, firm capabilities, and market access. For export growth to support broader development goals, policy must integrate more districts into export supply chains rather than concentrating gains in a few hubs.
Many regions may not become major final exporters, but can contribute through agro-processing, intermediate manufacturing, logistics, and export-oriented services. Targeted investment in common infrastructure – testing and certification facilities, cold chains, logistics parks, and digital trade platforms – can enable such participation, particularly for MSMEs. Equally important is aligning skill development and enterprise support with export opportunities. Export-linked skilling, compliance assistance, and access to market intelligence can help firms and workers move into higher-productivity activities. When export expansion is anchored in long-term investment and stable supplier relationships, it supports employment, productivity, and regional convergence rather than reinforcing existing divides.
