India’s goods exports in May increased 67.39 per cent to $32.21 billion compared to the same month last year, led by sectors such as gems and jewellery, petroleum products and engineering items, according to the trade data released by the Commerce & Industry Ministry on Wednesday.

Exports in May were also higher than the exports of $30.63 billion in April.

Imports of goods in May increased 68.54 per cent to $38.53 billion over May 2020, led by petroleum products, pearls, precious stones and semi-precious stones and electronic goods.

Imports down

Imports during the month were, however, lower compared to $45.72 billion in April. Trade deficit of $6.32 billion in May was at an eight-month low, pointed out Aditi Nayar, Chief Economist, ICRA.

It was less than half of the trade deficit of $15.1 billion in April.

“A predominant 63 per cent of the decline in the trade deficit in May relative to April 2021 was on account of the collapse in gold imports, with the balance led by a narrower oil deficit, led both by higher exports and lower imports,” she said.

Exporters’ body FIEO said the continuing sharp growth in exports reinforced its assessment that order booking position of exporters is healthy, and the gradual opening up of major global markets and improvement of situation in the country was expected to push exports growth further. It called for an early notification of input duty refund rates under the new RoDTEP scheme to remove uncertainty from the minds of the trade and industry, thereby helping in further forging new contracts with the foreigner buyers.

Like the previous two months, exports of engineering goods saw a substantial year-on-year rise of 53.14 per cent in May, pointed out Mahesh Desai, Chairman, Engineering Export Promotion Council of India. “We expect the order book of exporters to remain strong in the current financial year, given the demand trend from key markets such as US, China and Europe,” he said.

While much of the steep increase in exports could be attributed to the low base-effect, owing to last year’s pandemic-induced lockdown, exports in May were higher by 7.93 per cent compared to exports in May 2019 when production and exports were normal.

Imports in May were, however, lower by 17.47 per cent compared to imports in May 2019. India’s goods exports in April-May 2021 increased 112.29 per cent to $ 62.84 billion compared to the same period last year. Goods imports in April-May 2021 were $ 84.25 billion, an increase of 110.73 per cent over the first two months of last fiscal.

Export target

Encouraged by the healthy performance in exports over the last few months, the Commerce & Industry Ministry has set an export target of $400 billion for 2021-22. This would require a big jump over last fiscal’s exports valued at $290.18 billion, which was lower by 7.4 per cent compared to exports worth $313.36 billion in 2019-20.

Value of non-petroleum and non-gems and jewellery exports in May 2021 was $23.97 billion, a growth of 45.96 per cent over May 2020, according to the release. Non-oil, non-gems and jewellery imports were $26.14 billion in May 2021, a growth of 41.32 per cent over May 2020.