Exports dip 14.8% to $22.4 billion in July

Exports in July shrunk 14.8 per cent year-on-year to $22.4 billion, the worst performance since November 2011.

Releasing the provisional data on Tuesday, the Commerce Ministry attributed the fall to the continuing poor demand in traditional markets such as the European Union and the US.

Exports of most major segments declined with shipments of petroleum products plunging 19.4 per cent during the month, while engineering goods shrunk 16 per cent.

Stiff target, revival steps

Commerce Secretary S.R. Rao admitted that meeting the $360-billion export target (around 20 per cent growth) for 2012-13 would be a “stiff challenge” as global trade itself is falling and will continue to decline in the near future.

This would mean there would be problems on the balance of payments front for India. Even China, seen as a champion of exports, has seen its exports registering a steep fall recently, he pointed out.

Rao said the Commerce Ministry would soon take some “tactical” measures to boost exports and help the country increase its share in the global trade.

He added: “(The steps) will be in the nature (of easing) technical barriers to exports or reducing transaction costs to make exports more competitive.”

He said the Ministry would in 4-5 weeks notify norms to revive the growth of exports from Special Economic Zones, adding that it also would hold regular meetings with exporters, Export Promotion Councils, Federation of Indian Export Organisations and industry chambers to ensure that exports remain competitive during these tough times.

"We will do whatever it takes to boost exports and reduce trade deficit," Rao said.

The Ministry also indicated that there would not be any curbs on exports of rice, wheat, cotton and sugar.

Lower imports too

Meanwhile, imports also contracted (but much lesser than exports) 7.61 per cent to $37.9 billion. This resulted in trade deficit for July 2012 going up to $15.5 billion against $14.8 billion in the same month last year, Director General for Foreign Trade Anup Pujari said.

Oil imports in July slipped 5.52 per cent, he said. The Commerce Secretary said increasing domestic demand and an erratic monsoon meant a majority of the petroleum produce was being consumed within the country itself, leading to lesser exports.

Cumulative data

Exports during April-July this fiscal too contracted 5.3 per cent to $97.6 billion.

Of the 26 export sectors, three sectors (engineering goods, iron ore and fruits and vegetables) showed consistent negative growth, while six sectors registered positive growth (including cotton yarn and fabric, leather, spices, marine products and tea) and 17 sectors (including gems and jewellery and pharma) showed a mixed trend.

Oil exports during April-July declined 16.5 per cent.

Meanwhile, imports during the period declined 6.47 per cent to $153.2 billion. Of the major import sectors, 22 (including petroleum products) showed a mixed trends, while four were consistently negative (cotton raw and waste, pulp, ores) and one (pulses) remained in the positive growth territory throughout.

Oil imports during April-July showed a 2.76 per cent growth.

Trade deficit during the four months of this fiscal has narrowed to $55.6 billion from $61 billion during the same period last fiscal.

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