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Tamil Nadu – Trade Notes

Tamil Nadu – Trade Notes

8. Tamil Nadu – Trade

Trade is an important phenomenon that decides the economic growth of a country. The types of goods and services that a country exports and imports provide a mirror image of the economic structure. Trade may be defined as “an exchange of goods and commodities either within the country or between countries”. In simple terms, buying and selling of commodities is called trade and it may be local, regional, national and international. The primitive method of trade was known as the barter system where goods were exchanged for goods. Later on, money was introduced as a medium of exchange in buying and selling of goods.

Exports refer to goods and services sold for foreign currency. A country which increases its export transactions is said to accumulate foreign exchange reserves.

Major Exports of Tamil Nadu

  1. Textile goods
  2. Drugs and pharmaceuticals
  3. Chemicals
  4. Leather and leather goods
  5. Engineering goods
  6. Ores and minerals
  7. Software and electronics

Imports are goods and services bought from overseas producers. Almost every country of the world will try to pay for their imports through exports. Trade is not a mere exchange of goods; but it also includes exchange of service.

Major imports of Tamil Nadu

  1. Minerals fuel and mineral oil
  2. Electrical machinery equipment and spare parts.
  3. Iron and steel and articles of iron and steel
  4. Natural and cultured pearls
  5. Organic chemicals
  6. Plastics and articles
  7. Vegetable fats and oil products

Trade is of two types: 1. Internal Trade and 2. International Trade

Internal trade

Trade carried on within the domestic territory of a country is termed as internal trade. Roadways and railways play an important role in the internal trade. In this type of trade, the national currency is involved to carry on the trade.

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Tamilnadu Administration Notes

International Trade

Trade between two or more than two countries is termed as international trade. If the trade is between two countries, it is bilateral. There is also multi-lateral trade which occurs among more than two countries. Multinational currencies are used to carry on this type of trade. Ports and harbours play an important role in international trade.

Trade in Tamil Nadu

As Tamil Nadu has well developed roadways and railways, domestic trade is efficiently handled among the districts of Tamil Nadu.

For marketing the commodities, in the state, there are several Market Committees and regulated markets, functioning in all the districts of Tamil Nadu. Market Committees are formed by the nominated members of the beneficiaries and the Chairperson for the committee is selected by the members. There are about 21 market Committees to handle the marketing of agricultural goods and to fix a genuine prices for the commodity. At present there are about 303 Agricultural Produce Marketing Centres (APMC) distributed all over the districts of Tamil Nadu. The APMC is further classified into Primary, Secondary marketing centers and non-regulated marketing centers (Agmarknet statistics 2010). The largest number of 34 Marketing centers are found in Erode district followed by Coimbatore and Thanjavur with 21 centers.

Uzhavar Sandhai scheme was initiated for direct selling of fruits & vegetables at a fair price by the farmers to the consumers without any intermediaries. The 1st Uzhavar Sandhai was started at Madurai in 1999 and there are about 103 such Uzhavar Sandhais in the state. Every day on an average 1609 MT of fruits and vegetables worth of Rs.191.77 lakhs are sold by 7526 farmers 2,71,685 consumers were benefited through Uzhavar Sandhais during the year 2008-2009.

Market Complexes with storage facility are available all over the state.

Tamil Nadu Co-operative Silk Producers Federation, TANSILK an apex co-operative body, with Headquarters at Kancheepuram, purchases raw silk and supplies them to Handloom Weavers Co-operative Societies and other weaving sectors.

Industrial Co-operatives, a wing of the Department of Industries and Commerce, Government of Tamil Nadu in arranging to the market the products of rural artisans through Handicrafts Co-operative Societies. State Industries Promotion Corporation of Tamil Nadu(SIPCOT) focuses on developing, marketing and maintaining industrial complexes/ parks within the state.

The exports of Tamil Nadu has been increasing at faster rate than the overall exports of the country. The significant rise information Technology (IT) companies in Tamil Nadu has promoted the value of software export in recent years. The following are the value of software products sent abroad.

Tamil Nadu – Major Exports 2005-2009 value in Rupees

Year Exports (Rs. in million)

2007/08 284,260

2009/09 366,800

Foreign Trade(Rs. in million)


By Sea 602,600

By air 74,990


By sea 1,285,400

By air 304,950

Importance of Trade

Trade is called an engine of growth because:

  1. It helps in the increase of foreign currency reserve.
  2. It makes available all kinds of goods anywhere.
  3. Trade increases technology transfer from one country to another.
  4. It improves the welfare of the workers.
  5. It helps to increase the total production of an country.

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