The Drivers of India’s Agricultural Trade: A Study Based on Major Crops

Even though India is predominantly an agricultural economy, we find dearth of works related to Indian agricultural trade combining both export and imports. This paper attempts to examine the performances of major Indian agricultural crops both in terms of export and imports and tries to attribute it on various policy variables like domestic and world tariff, GDPs, price differentials and exchange rate movements for the period 1990–2016. Using panel ARDL model, we find that growth in home as well as world GDP help to increase agricultural imports and exports by India respectively. However, exchange rate is found to be highly responsive for agricultural imports but does not affect agricultural exports. World tariff rate and the price differences between home and foreign locations are found to be statistically significant in controlling values of agricultural exports. An increase in per hectare productivity of agricultural commodities helps exports too.