India’s share is still paltry in global value chains (GVCs) but the country has immense opportunities to expand, said Sanjiv Puri, President of the Confederation of Indian Industry (CII) and CMD of ITC Ltd.

Speaking on Thursday at an event in the capital, Puri said that 70% of the global trade happens through global value chains. There are clear global trends showing that supply chain diversification is happening across levels. The current trajectory indicates that India is well-positioned to gain from trade developments, he said.

“We have all heard about China Plus One. That’s very important because 70% of the global trade is happening in GVCs. So, we are starting to make progress. I think it is early days. We have 1.5% share in GVCs. So the headroom to grow is tremendous,” Puri said.

Effectively entering GVCs will require taking deliberate measures in the near future. Innovation, intellectual property (IP), and research and development are going to be extremely critical areas in boosting value addition in the economy, he pointed out.

The CMD of the FMCG behemoth, who has taken over as President CII for 2024-25, asserted that there is a need to create a global trade promotion organisation with dedicated officers placed overseas — just like other developed economies have done.

He emphasised the need to align standards and upgrade certifying bodies to streamline the export process. “Just like it’s done for merchandise export, we believe that the scheme to reimburse refund taxes for service exports would be useful. Also, to integrate us well with the global value chains, it’s important to upgrade our standards and align Indian certifying bodies with global ones. So, the export process can be quite seamless. Transitioning to 10-digit HS codes (from 8-digit now) is necessary as that is the global standard. It would be useful. We have also signed some FTAs in the recent past. The UAE CEPA was one, and there are others too in discussion. These will further open the doors for increased inflow of investments and technology and give access to trading markets,” he said, adding that the Indian economy is robust.

Notably, the CII expects the Indian economy to grow at 8% in the current fiscal year.

The industry body’s sectoral growth forecast for 2023-24 to 2024-25 for agriculture is 1.4% to 3.7%, for industry is 9.3% to 8.4%, and for services is 7.9% to 9%.

“We are expecting all the three main sectors of the economy — agriculture, industry and services — to fire up next year. The sectors that have seen improvements in private investments include infrastructure-linked sectors such as cement, steel, PLI-oriented sectors such as electronics, manufacturing, food processing, telecom and pharma, logistics, renewable energy, automobiles, electric vehicles and semiconductors,” Puri added.

The CII has further recommended institutional platforms for building state-level consensus on critical reforms relating to land, labour, power, agriculture and fiscal sustainability. It also pitched for all regulatory permissions for running businesses, including state-level permissions, to be mandatorily provided through the National Single Window System in a time-bound manner.

"we recommend creating an ecosystem where Industry, research institutions, and academia are connected, with a focus on strategic areas. The Rs 1 lakh crore R&D fund announced in the Interim Budget could be used for this process," Puri added.