Ex­ports Slip 15.8% in FY16 on Slow Global Re­cov­ery, Low Comm Prices

The Economic Times - - Economy - Our Bureau

New Delhi: Pulled down by slow global re­cov­ery, soft­en­ing com­mod­ity prices and weak de­mand, the country’s ex­ports for FY16 set­tled at their low­est since FY11.

Ex­ports added up to $261.1 bil­lion in FY16, down 15.85% from $310 bil­lion in 2014-15. In FY11 the ship­ments were at $245.9 bil­lion.

An equally sharp de­cline in im­ports meant In­dia’s trade deficit im­proved from last year. Data re­leased by the com­merce and in­dus­try min­istry showed that cu­mu­la­tive value of im­ports for the pe­riod April-March 2015-16 was $379.5 bil­lion against $448.03 bil­lion, reg­is­ter­ing a 15.28% de­cline and leav­ing a trade deficit of $118.5 bil­lion dur­ing the year. “The trend of fall­ing ex­ports is in tan­dem with other ma­jor world economies,” the min­istry said in a state­ment.

Full year oil im­ports were down 40% while non-oil im­ports fell 4.12%. Led by an 80.48% drop in gold im­ports, In­dia’s trade deficit nar­rowed for the third straight month in March to $5.07 bil­lion, the low­est in more than five years.

March im­ports de­clined 21.56% at $27.78 bil­lion, out­pac­ing the 5.47% fall in ex­ports which stood at $22.71 bil­lion. Ex­ports have fallen for six­teen months in a row.

“The halv­ing of the mer­chan­dise trade deficit in March 2016 with re­spect to March 2015 was pre­dom­i­nantly on ac­count of a sharp de­cline in gold im­ports fol­low­ing the jewellers’ post-bud­get strike as well as lower net oil im­ports led by a fall in price and vol­umes,” said Aditi Na­yar, se­nior econ­o­mist at ICRA.

“The one-off plunge in gold im­ports in March 2015 has con­trib­uted to the sharp fall in the mer­chan­dise trade deficit, dis­guis­ing the con­tin­u­ing weak­ness in nonoil mer­chan­dise ex­ports.” The weak data comes days af­ter the WTO cut its fore­cast for world trade in 2016 fur­ther from 3.9% ear­lier to 2.8%. In Septem­ber last year, it had re­vised the es­ti­mate for 2016 down­wards to 3.9% from 4.0%. How­ever, the WTO ex­pects global trade growth to rise to 3.6% in 2017.

Full year oil im­ports were down 40% while non-oil im­ports fell 4.12%

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