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Exports posted a growth of 4.25 per cent to $26.26 billion in February 2013 compared with $25.19 billion in February last year, as the economic situation in the European Union and the US improved.
Imports grew at a slower pace of 2.6 per cent to $41.18 billion during the month compared with $40.18 billion in February 2012 containing trade deficit at last year’s level and raising hopes of an improvement in the country’s current account deficit situation, which is at an all time high.
“We expect trade deficit to narrow because exports are picking up. We are indeed witnessing a small recovery in exports and are hopeful,” Commerce Secretary S.R. Rao said addressing a press conference on Monday.
The annual supplement to the Foreign Trade Policy likely by the end of the month will include an additional set of measures to boost exports, the Secretary added.
Exports had fallen continuously between May and December last year mainly due to subdued demand from the crisis-hit EU and the US. In January 2013, exports finally posted a growth, although a meagre 0.8 per cent, helped by the two incentive packages announced earlier by the Government.
Stronger growth in exports posted in February reflects an arrest in the decline in the economic health of the European Union and continued improvement in the US, the Secretary said. “The US markets are behaving. So are the markets in the EU,” he said.
There is, however, a long road ahead before exports grow enough to bring down the deficits in the trade account and current account and ease pressure on the balance of payments front.
In the April-February 2012-13 period, exports dropped four per cent to $265.95 ($277.1 billion). Imports in the same period grew marginally at 0.25 per cent to $448.04 billion ($446.9 billion). Trade deficit, as a consequence, increased to $182.1 billion ($169.8 billion).
Petroleum imports during April-February 2012-13, posted a growth of 11.9 per cent to $155 billion, while for February 2013 the increase was higher at 15.45 per cent. Gold and silver imports fell 7.6 per cent in April-February 2012-13 to $52.4 billion while in February 2013 they posted a growth of 15.23 per cent.
Exporters say easier availability of credit will help their cause considerably.
“To keep the momentum going it is important that the Government keeps availability of credit to industry at lower rate. Separate chapter for exports can be a game changer,” Apparel Export Promotion Council Chairman A. Sakthivel said.
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