Sectoral Patterns and Determinants of Global Value Chain Participation: Evidence from India in Comparative Perspective

This paper analyses India’s participation in global value chains (GVCs) through a detailed sectoral and comparative perspective. Using value-added trade data and recent methodological advances, it shows that India’s integration remains below its potential, particularly in manufacturing, where participation is largely concentrated in downstream activities. By contrast, the services sector exhibits stronger forward linkages, reflecting its role in generating value added in exports.

The analysis highlights recent increases in GVC participation in network industries such as electronics, machinery, and transport equipment, driven mainly by stronger backward linkages. It also identifies key determinants of GVC integration, showing that higher tariffs on intermediate inputs act as a constraint, while exchange rate dynamics interact with trade costs in shaping participation.

Overall, the paper underscores the importance of policies aimed at reducing input barriers and supporting a gradual upgrading within global value chains