Commerce Ministry is entitled to represent India at the World Trade Organisation (WTO), enter into international trade deals, keep a check on all the sectors' growth of India and in turn, contribute a major chunk to the country's GDP.
The newly-appointed Commerce Minister Suresh Prabhu, who was earlier the Railways Minister for three years, is likely to face many challenges in his new list of duties.
Commerce Ministry handles the major component in developing the country. This is the government department entitled to represent India at the World Trade Organisation (WTO), enter into international trade deals, keep a check on all the sectors' growth of India and, in turn, contribute a major chunk to the country's GDP.
Here are 3 major challenges lined up for Suresh Prabhu
WTO is the world's largest trade forums where the countries who are a part of this forum take major decisions which revolve around building trade relations by either making new ones or resolving old ones. The trade-related matters are supervised by the WTO body.
The WTO conference is around the corner and Suresh Prabhu seems to be preparing himself by taking advice from his predecessors, according to Indian Express.
According to the report, he is taking inputs so that he is able to learn from their experiences.
India is an import-extensive country, making it one of the biggest challenges for the Commerce Ministry. The Ministry has to boost India's exports and lower the country's imports for the country to become more independent.
If India is made export-extensive, it will not have to be dependent on other countries for its growth and development.
In the recent data released by the Commerce Ministry, it states that India already has an import share of 79.17 percent as against the export share of 69.54 percent among the top 25 countries it trades with. This data accounts for the trade of April and June this year, making a 10 percent imbalance in trade prevalent in two months itself.
Higher imports cause a trade imbalance as the country will have to first pay off its import bills and then see its overall growth. More import bills mean a rise in the government's expenditure and more export bills mean a rise in the government revenue. As of now, India's trade balance is negative, showing that the imports are much higher than the exports.
To tackle this situation, the Commerce Ministry has to boost domestic manufacturing, tap the resources within the country and make sure that the products are at par with the international standards.
With trade on one side, one can not deny that international relations for every economy are vital. These international relations become stronger with trade deals which can result in helping the economies to grow. Suresh Prabhu has a long list of trade deals which he has to look after.
He has to prepare himself to negotiate free trade deals with China, Japan and Australia and negotiate thoroughly for bilateral free trade deals with Canada and the European Union.With US President Donald Trump turning hostile towards free trade deals, it will be even more challenging for Prabhu to strike these deals with WTO's tougher norms.