FROM LOCAL TO GLOBAL: DIGITAL TRADE, TECH DIPLOMACY, AND THE FUTURE OF MSMES IN INDIA
DOI:
https://doi.org/10.5281/zenodo.18595974Keywords:
Digital Trade, Tech Diplomacy, India, MSMEs, ONDC, UPI, Tier-1 vs. Tier-2/3 Cities, Global Value Chains, Digital Inclusion, Policy FrameworkAbstract
Digital trade has emerged as a critical driver of global commerce, enabling micro, small, and medium enterprises (MSMEs) to access new markets and participate in international value chains. India’s pursuit of technology-driven diplomacy—through initiatives such as the internationalization of the Unified Payments Interface (UPI) and the Open Network for Digital Commerce (ONDC)—illustrates its commitment to positioning MSMEs within the global digital economy. This study investigates the role of India’s tech diplomacy in shaping MSME competitiveness by comparing enterprises integrated with ONDC against those reliant on conventional trade channels, and by analyzing disparities between Tier-1 and Tier-2/3 city-based enterprises. Employing a mixed-method approach of descriptive statistics, survey responses, and case-based comparisons, the findings indicate that ONDC-enabled MSMEs in Tier-1 cities report higher levels of digital visibility, transaction efficiency, and readiness for cross-border trade. In contrast, MSMEs in Tier-2/3 cities encounter barriers related to digital infrastructure, limited awareness, and inadequate policy outreach, which restrict their ability to fully benefit from global digital trade frameworks. The study concludes that while India’s digital trade diplomacy is creating a more inclusive ecosystem, persistent gaps must be addressed through targeted interventions such as digital capacity building, infrastructure expansion, and regulatory harmonization. By bridging these divides, India can strengthen the integration of its MSMEs into global commerce. The study contributes to the emerging discourse on digital trade, diplomacy, and inclusive economic development, offering insights relevant to policymakers, practitioners, and scholars.
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