Is the Path to Higher Exports in India Paved with Export Zones?

Enclave based policies to promote exports, and consequently economic growth, are not new to India. India’s first export zone started in 1964 and six more central government zones were operational by the mid 1990s. However, these zones explain only a fraction of export growth rates in India. Statistics show that during the pre-reform years, these zones contributed to less than five per cent of total exports and even now contribute to less than fifteen per cent of total exports from India. There seems to be no obvious correlation between export growth and export zones that warrants the spate of new zones in the country. Partial trade liberalisation since the mid 1980s and general reforms since 1991 seems to better explain export growth.