AN ANALYSIS OF TRADE DISPARITIES AMONG INDIAN STATES

There are two set of theories which talks about Inequality in international trade. First theory which was put forward by Gregory Mankiw, the notion that ‘trade can make everyone better off’. Second set theory which was put forward by economists like Krugman and Gunnar Myrdal which states that trade leads to divergence in regional incomes and thus leads to inequality. States has an important role to play in removing these inequalities. NITI aayog in India plays a major role in it. One important organization tasked with addressing India's regional disparities is NITI Aayog. NITI Aayog released Export preparedness Index 2022-23. This paper seeks to find out causes and challenges behind inequality in export performance among states and suggest some policy measures to uplift the bottom states. The state level data of export disparities among states were extracted from Export Preparedness Index which is released by NITI Aayog. States wise change detection of exports were done. The index shows there exists disparities among states in export performance. Tamil Nadu, Maharashtra and Karnataka are the top three states in Export Performance While Lakshadweep, Mizoram, Dadra Nagar and Haveli and Daman Die are the worst performing UTs and states. The findings highlights that geographic distribution of exports reveals that India’s states are highly unequal in terms of industrial development, regulatory complexities, infrastructure connectivity, availability of skilled manpower, etc. The data indicates that few states contributes towards a major share of the exports of India and leads to disparities among states in export performance. Geography, natural resources, Infrastructure, industrial history, etc. are few of the causes which leads to disparities among states in export performance.