Not only the scope of world trade expansion in these commodities was less but additionally India had to face competition from new emerging suppliers, such as Pakistan in jute manufactures and Ceylon and East Africa in tea. During this period, policy emphasis was on import saving rather than export promotion, and priority was given to basic goods and capital goods sector.
It was argued that investment in heavy industries would bring in saving in foreign exchange, as output from such industries would replace their imports in the long-run. Import-substituting strategies were expected to  BIS central bankers’ speeches  1  gradually increase export competitiveness through efficiency-gains achieved in the domestic economy. But this did not happen. Hence, exports remained modest.