Arvind Subramanian, Chief Economic Advisor (CEA) of the country has said that India can grow at the rate of 8-10% if it has strong performing exports. CEA said that the International Economic environment of exports is not in the favor of India, as Europe, China and Japan are slowing down and said “I don't think there is one historical experience in the last 50-60 years where countries have rapid rate of growth without having strongly performing exports”. While talking about loose monetary policy which is followed by some countries he said that it will surely impact the growth performance of India.
CEA expressed his concern that India might lose the biggest export market of the world and is going to be a victim of trade diversion, as negotiations of big countries for preferential trade agreements is increasing, where US is close to competing agreement with a number of Asian countries and the European Union. Also, China which is going to be a part of trans-Atlantic trade agreement is a real risk for India to get excluded from the biggest market of the world. Non tariff barriers can also be disadvantageous for India and these are a huge challenge for the external trade environment which should be taken care of.
Further CEA said that India should have a competitive exchange rate where we have to upgrade local infrastructure which will boost exports growth and also added that the government's Make in India initiative will help to strengthen the economy.