India’s merchandise exports in Oct decline 16.65%
NEW DELHI: India’s merchandise exports in October fell 16.65% on an annualised basis to $29.78 billion on account of strong global headwinds that slowed major economies such as the US and China, while imports in the month rose by about 5.68% to $56.69 billion on sustained domestic demand in one of the fastest growing major economies of the world. On Monday, Mint reported (and HT carried) a report citing unofficial preliminary data that put the fall at 19%.
India’s total exports in the month, which includes both goods and services exports, however, posted a 4% jump to $58.36 billion compared to $56.10 billion i n the same month last year. Goods and services imports together rose by 11.82% to $73 billion in the month, according to official data released on Tuesday.
Overall (merchandise and services trade), India’s trade deficit rose to $14.63 billion in the month of October compared to $9.18 billion in the same month last year, according to the data.
The country’ overall exports (merchandise and services combined) in the first seven months of t he current fiscal year jumped 19.56% on an annualised basis to $444.74 billion. Overall imports in the same period (April-october 2022) also surged 33.8% to $543.26 billion, leaving a trade deficit of $98.52 billion.
Briefing media, commerce secretary Sunil Barthwal said India’s trade performance reflects the current global situation. The country’s exports fell because of “headwinds” faced by major economies such as the US and those in the EU. Advanced economies, suffering from high inflation, are resorting to monetary tightening, which is resulting into slacked demand and fall in consumption.
“Rise in imports are because India is one of the fastest growing economies with rising consumption. Rising domestic production in many sectors have seen growing imports of inputs. Electronics has come out as a bright spot, perhaps a reflection of government’s policy push,” he added, emphasising the need for granular analysis of trade data to draw definitive conclusions.
According to the data, exports of electronic goods rose to $1.85 billion, a 37.6% jump in October compared to $1.35 billion in the same month a year ago. Sectors that recorded export growth in the month included oil seeds, tobacco, tea, and rice. Sectors that saw a decline in exports, included gems and jewellery, engineering, petroleum products, readymade garments of all textiles, chemicals, pharma, marine products, and leather.
The jump in imports during October is mainly due t o increased shipment of raw materials and inputs such as energy, cotton, fertiliser and machinery, according to the data.
The commerce secretary said that according to a World Trade Organisation (WTO) estimate, global trade will grow 3.5% this year (2022) and only 1% in the next (2023). India’s share in global merchandise trade is only 1.8%; it is 4% in global services.
Hence, “there is a lot of potential to increase” India’s share in global trade, he added.
Barthwal said due to confusion arising from initial monthly trade data and revised data of the same month after a fortnight, the ministry has now decided to release fully “updated data” only once in a month.
An official and a trade expert aware of the development said the government’s focus on freetrade agreements would further open up some major developed markets such as the UK, the European Union and Canada. The Uk-india FTA is expected to be closed by March 2023, they added, requesting anonymity. FTAS with the EU and Canada are progressing well, they said.