Kerala improves rankings from 19 to 11 in NITI Aayog’s export preparedness index

Overview Kerala has shown significant improvement in its export performance, as reflected in the NITI Aayog’s Export Preparedness Index (EPI) 2024 . The state has climbed to 11th position among all states, a notable jump from its 19th rank in the previous edition of the Index for 2022 . This improvement highlights Kerala's increasing focus on enhancing its export capabilities and competitiveness in the global market. Key Developments EPI 2024 Ranking Kerala achieved a score of 44.03 in the EPI 2024 , placing it in the challenger category. While this is a significant improvement, it still lags behind the leading state, Maharashtra, which scored 68.01 . The index considers factors such as export policies, business environment, quality of infrastructure, and export outcomes. Export Growth In the financial year, Kerala experienced a remarkable year-on-year export growth rate of 86.9% . The total value of exports reached ₹68,375 crore , demonstrating the state’s growing competitiveness in global markets. This substantial increase underscores the effectiveness of the state's export-oriented policies and initiatives. Economic Indicators In 2023-24 , Kerala achieved a Gross State Domestic Product (GSDP) of ₹11.1 lakh crore . The Micro, Small and Medium Enterprises (MSME) sector witnessed substantial growth, with an increase of 97.7% in 2023-24 over the previous year, indicating a thriving entrepreneurial ecosystem. This growth in the MSME sector is a key driver of the state's overall economic performance. Export Profile Kerala’s export profile spans various sectors, including: Petroleum products: Account for nearly 48% of the State’s total merchandise exports. Spices Marine products Coir Information technology Out of Kerala’s total exports of ₹68,375 crore , ₹32,635 crore comes from petroleum oils, driven by the production and refining capacity of the Kochi refinery . The State’s well-diversified export basket reaches over 100 countries , with strong West Asian linkages supported by its large diaspora. Ease of Doing Business The report highlights that high rankings in Ease of Doing Business , backed by digital platforms like K-SWIFT and K-CIS , along with investor-friendly laws such as the Kerala Investment Promotion and Facilitation Act and MSME Facilitation Act , streamline clearances and reduce compliance burdens. Entrepreneurship drives and policy support further enhance Kerala’s competitive, export-friendly ecosystem. Challenges According to the report, Kerala’s industrial growth is slowed by the lack of large, connected land due to high population, small plots, and strict land-use rules. High costs, local resistance, and complex negotiations make land acquisition difficult. The report further notes that strengthening cold chains, modern packhouses, and spice sterilization units will reduce post-harvest losses and meet stringent international standards. Improved logistics via Cochin and Vizhinjam ports, along with enhanced air cargo infrastructure at Thiruvananthapuram , Kochi , and Kannur , will expand global reach for perishables. The report warns that without strategic interventions to retain talent, boost R&D, and foster innovation ecosystems, Kerala’s industrial dynamism and long-term export sustainability could be at risk. UPSC Relevance This analysis is relevant for UPSC Civil Services Exam , particularly for GS Paper III (Economy) and GS Paper II (Government Policies & Interventions) . It provides insights into state-level economic performance, export competitiveness, and the role of government policies in promoting industrial growth. Understanding these aspects is crucial for answering questions related to economic development, trade, and investment. Important Facts for UPSC Kerala's improved ranking in EPI 2024: Demonstrates the state's progress in export preparedness. Export growth rate: Highlights the state's increasing competitiveness in global markets. Contribution of MSME sector: Shows the importance of small businesses in driving economic growth. Challenges in land acquisition: Illustrates the constraints on industrial development in Kerala. Need for talent retention and R&D: Emphasizes the importance of innovation for long-term sustainability.

Kerala improves rankings from 19 to 11 in NITI Aayog’s export preparedness index

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Kerala improves rankings from 19 to 11 in NITI Aayog’s export preparedness index

Kerala improves rankings from 19 to 11 in NITI Aayog’s export preparedness index

Overview

Key Points

Full Article

Analysis