Interdependence in Imports, Production, Exports and Term of Trade in India - An Empirical Study

Emphasis has been laid down to liberalisation of imports as part of transformation process, and globalisation programme in India. Accordingly, many policy initiatives have been taken, which brought down the applicable customs duty rate to less than 20 percent on an average. Further, the licensing requirements on facilitating the availability of imported raw materials and capital goods at a lower cost the Indian producers. With this background, this paper aims to analyse the trends in import of industrial sector and liberalisation period. The hypothesis is that the import finished goods, raw materials and capital goods are expected to increase, even though the terms of trade have not been deteriorated significantly