INDIA’S EXPORTS DECLINE IN FEB AFTER 2 MONTHS OF EXPANSION

NEW DELHI: India’s merchandise exports contracted in February after two successive months of growth amid increasing concerns of a second wave of coronavirus infections, and delay in implementing a tax reimbursement scheme for exporters.

Preliminary data released by the Union commerce ministry on Tuesday showed that exports fell 0.25%, while imports picked up to grow at 7%, leading to a trade deficit of $12.9 billion during the month. In April-february, merchandise exports contracted 12.32% while merchandise imports fell 23.1% resulting in a $151.4 billion trade deficit in the first 11 months of FY21.

In February, exports of petroleum products (-27%), gems and jewellery (-11%) and engineering goods (-2.6%) fell while shipments of pharma products rose by around 15%. Among major import items, petroleum (-16.6%) and transport equipment (-23%) fell, while import of gold (124%), electronic goods (38%) and chemicals (37.6%) shot up.

India’s merchandise trade had been weakening even before the pandemic hit the economy and external demand. Exports fell in 16 of the past 20 months starting June 2019. Since March 2020, exports and imports started declining in high double digits.

Federation of Indian Export Organisation president Sharad Kumar Saraf said the export decline in February was mainly on account of container shortages and limited supply disruptions in the last week of the month. “We continue to see signs of further revival not only in the order booking positions, but also in the demand from across the globe, paving the way for much better days and months for the sector. However, rising exports from China has led to the shortage of containers in the region,” he added.