Indian govt invites proposals to establish e-commerce export hubs

The Indian government has invited proposals from industry stakeholders to establish e-commerce export hubs (ECEH) across the country.

The initiative, announced during the recent Budget, aims to promote exports through e-commerce by providing a streamlined infrastructure that supports small producers, aggregators, and various stakeholders involved in cross-border trade.

The project is seen as a significant step towards increasing India’s share in the global e-commerce export market.

Objectives and benefits of ECEH

The primary objective of the ECEH initiative is to create a conducive environment for e-commerce exports by ensuring predictability and the shortest possible turnaround times.

These hubs are designed to facilitate easy re-imports for returns or rejects and bring various cross-border e-commerce stakeholders under one roof.

Initially, the government plans to set up 10-15 such hubs in designated areas that will serve as centres with favourable business infrastructure, making it easier for small producers to reach global markets through aggregators.

Operational structure and facilities

Each ECEH will have two key physical components. The first will be a fulfillment area dedicated to the packing, labeling, and storing of goods after they have been pre-screened and are waiting for a buyer.

The second component will be a customs station where goods will be cleared and prepared for dispatch once a buyer has been found.

Additionally, these hubs will offer warehousing facilities, customs clearance, returns processing, labelling, testing, and repackaging services, all under one roof to streamline the export process.

Potential Impact on India’s Export Market

India’s current exports through e-commerce are relatively low, amounting to approximately USD 5 billion, in stark contrast to China’s $300 billion.

However, there is a significant potential for growth, with estimates suggesting that Indian e-commerce exports could reach between $50-100 billion in the coming years. 

A report by the economic think tank GTRI indicates that e-commerce exports from India could soar to $350 billion by 2030 if certain challenges, particularly those related to banking and operational costs, are addressed.

Government’s vision and future plans

The government has set a target of reaching $1 trillion in merchandise exports by 2030, with cross-border e-commerce identified as a critical medium to achieve this goal.

The ECEH initiative is part of a broader strategy to replicate successful models seen in countries like China, South Korea, Japan, and Vietnam, where similar hubs have significantly boosted exports for Micro, Small, and Medium Enterprises (MSMEs) and artisans.

The detailed proposals submitted by industry stakeholders will be crucial in finalizing the operational modalities, including the software requirements needed to facilitate seamless and expeditious export clearances.

By establishing these hubs, the government aims to not only enhance the ease of doing business for small exporters but also position India as a competitive player in the global e-commerce market.