Indian Council for Research on International Economic Relations

Completed Details

Enhancing India’s Participation in Global Value Chains

Project Leader: Dr. Saon Ray
Research Team: Smita Miglani and Neha Malik
Commencement: September 2013
Completion: March 2015
Funded by: Foreign and Commonwealth Office, Government of U.K

The production of goods is becoming increasingly fragmented and spread out across the world. This has led to the emergence of complex production networks with increased participation of the developing countries. This study examines India’s participation in global value chains through a better understanding of India’s positioning in the global production system.

While India lags in global value chain participation rates, the evidence base for this is weak. A survey of about 100 firms in selected industries gathered empirical evidence of their engagement in global value chain activity, the domestic barriers to those engagements, and the costs associated with the barriers. In order to identify the sectors, which could be taken up in the survey, an analysis of sectors was done using World Input-Output Database (WIOD)
and also secondary data from selected sectors using UN COMTRADE data was analysed.

Field discussions (with the industry and researchers) and analysis of the available trade data helped to identify particular segments where India’s participation in global value chain activity has traditionally been, or recently become successful for various reasons. These segments (or sectors) were: passenger cars in the automobile industry, reactive dyes and specialty chemicals in the chemicals industry, semiconductor chips in IT, and formulations in the pharmaceutical industry.

Research

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