“Shifting Trade Patterns and GVC Participation: India’s Linkages with Selected Economies”

Abstract

This paper examines India’s integration into the global value chain (GVC) with selected emerging Asian economies—China, Indonesia, Japan, South Korea, Turkey, Malaysia, and the Philippines—covering the period from 1991 to 2020. It analyses India’s trade in intermediate and final goods and evaluates the involvement of primary, resource-based, and low-, medium-, and high-technology products within these value chains. Further, the study assesses India’s manufacturing network products and its overall competitiveness across major sectors using key trade indicators. The findings indicate significant shifts in India’s export and import shares with Asian economies over time. Export shares increased with Malaysia, Indonesia, Korea, the Philippines, and Turkey, whereas a decline was observed with Japan and China, particularly during the COVID-19 period. Import shares rose mainly from China, Indonesia, and Korea. Overall, India’s trade growth with these economies experienced considerable fluctuations due to global economic crises and other shocks. The study also shows that India’s total GVC participation with the world increased from 23.96 percent in 1991 to 31.40 percent in 2020. While backward participation expanded substantially, forward participation declined. India’s GVC linkages with China, Indonesia, Korea, Malaysia, the Philippines, and Turkey generally strengthened, despite periodic instability driven by economic uncertainties. Additionally, India’s share of network products in manufacturing trade grew markedly with China and showed moderate expansion with Indonesia, the Philippines, South Korea, and Turkey. Overall, the paper highlights the growing significance of Asian partners in advancing India’s engagement and competitiveness in global value chains.