The Hindu Business Line : Import surge leaves trade deficit at all-time high

THE country's merchandise exports during 2004-05 touched a record $79.59 billion, fuelled by sustained demand abroad for traditional and non-traditional items, even as the trade deficit also set a record level of $26.6 billion following an unprecedented import worth $106 billion.

According to provisional figures released by the Commerce Ministry today, merchandise exports during the year at $79,593.59 million ($79.59 billion) registered a growth of 24.41 per cent over the level of $63,978.78 million ($63.9 billion) in 2003-04.

The export growth in 2003-04 over the previous year was 21.31 per cent.

The export growth rate target of 16 per cent originally set for 2004-05 (corresponding to a value of $73.4 billion) has been surpassed by 50 per cent.

In rupee terms, the exports were worth Rs 3,57,076.54 crore during the year, 21.72 per cent higher than the figure for 2003-04.

When contacted, the Commerce Secretary, Mr S.N. Menon, told Business Line that it takes a few days to get the disaggregated picture.

However, given the salutary performance of the export during the last three years, the export momentum is sustainable, he said. This target was set when the annual supplement to the Foreign Trade Policy was announced by the Commerce Minister, Mr Kamal Nath, on April 8.

Meanwhile, an internal study of the trends in exports during the first 11 months of 2004-05 shows that high-growth items include iron ore at 158 per cent, petroleum, crude and products at 91 per cent, plastic and linoleum products at 87 per cent, primary and semi- finished steel at 53 per cent, and transport equipment at 50 per cent.

The major trading partners were Singapore, which recorded the highest growth at 78 per cent, followed by China (58 per cent) and the UAE (38 per cent).

Imports during the year were valued at $1,06,121.18 million ($106 billion), representing an increase of 35.62 per cent over $78,250.86 million in 2003-04.

Oil imports were valued at $29,084.44 million, 41.19 per cent higher than $20,599.19 million in the corresponding previous period. Non-oil imports are estimated at $77,036.30 million, 33.62 per cent higher than $57651.67 million clocked earlier.

Exports during March 2005, the latest monthly figure available, were valued at $8,513.53 million, 8.28 per cent higher than $7,862 million recorded in March 2004. In rupee terms, the exports were worth Rs 37,196.06 crore, 5.09 per cent higher than the figure for March 2004.

Imports in March 2005 are estimated at $10,083.90 million, representing an increase of 25.52 per cent over $8,033.86 million in March 2004.

In rupee terms, the imports increased by 21.82 per cent.

The high export growth and a higher import growth meant a record trade deficit for the country, which for the first time amounted to a massive $26,527.59 million, higher than $14,272.08 million in 2003-04.

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