India’s exports rise marginally in August; trade deficit more than doubles to USD 27.98 billion

PTI

New Delhi, September 14

India’s exports rose marginally by 1.62 per cent to USD 33.92 billion, while trade deficit more than doubled to USD 27.98 billion in August due to increased crude oil imports, commerce ministry data showed on Wednesday.

The revised data showed that imports rose by 37.28 per cent to USD 61.9 billion in August this year.

The preliminary data released by the ministry on September 3 had shown a 1.15 per cent decline in exports to USD 33 billion in August.

During April-August 2022-23, exports registered a growth of 17.68 per cent to USD 193.51 billion. Imports during the five-month period of this fiscal grew by 45.74 per cent to USD 318 billion.

Trade deficit widened to USD 124.52 billion in April-August this fiscal as against USD 53.78 billion in the same period last year.

The deficit in August last year was USD 11.71 billion.

Crude oil imports in August this year increased by 87.44 per cent to USD 17.7 billion. However, gold imports dipped by about 47 per cent to USD 3.57 billion, the data showed.

On the other hand, silver imports jumped to USD 684.34 million during the month under review from USD 15.49 million in the same month last year.

Rise in import values in August has been witnessed in major commodity groups such as coal, coke & briquettes (133.64 per cent to USD 4.5 billion), chemicals (43 per cent to about USD 3 billion), and vegetable oil (41.55 per cent to about USD 2 billion).

Further, export products that recorded positive growth in August included electronic goods, rice, oil meals, tea, coffee and chemicals.

Export of petroleum products rose by 22.76 per cent to USD 5.71 billion. Similarly, chemicals and pharma shipments increased by 13.47 per cent and 6.76 per cent to USD 2.53 billion and USD 2.14 billion respectively.

Sectors which recorded negative growth in August included engineering (14.19 per cent to USD 8.3 billion), gems and jewellery (about 3 per cent to USD 3.33 billion), ready-made garments of all textiles (0.34 per cent to USD 1.23 billion), and plastic (1.10 per cent to USD 747.21 million).

Meanwhile briefing media here, Federation of Indian Export Organisations (FIEO) said they expect that exports would start picking up from October onwards.

Reasons like rupee depreciation and moving away of buyers from China as manufacturing cost is going up in Beijing will help India’s exports in the coming months, FIEO president A Sakthivel said.

It expects the country to clock USD 470 billion in goods exports this fiscal.

FIEO director general Ajay Sahai said that demand for low-value goods is increasing but volumes seem to remain intact.

The WTO has already revised its forecast for the global trade growth to 3 per cent from 4.7 per cent in April and FIEO expects a further downward revision in October.

“China is becoming costlier and less reliable with a zero Covid tolerance policy and anti-China sentiments are gaining ground day by day. A lot of orders for low-value products, which were a virtual monopoly of China, are now coming to India,” the organisation said.

On the production linked incentive scheme for the textile sector, Sakthivel said that after technical textiles and manmade fibre, the government is looking at incentives for more sub-sectors with relaxed investment and turnover criteria of Rs 25 crore and Rs 50 crore, respectively.

“Uniqlo is in talks with the textiles ministry to have one complete PM Mitra park (for its operations),” Sakthivel told reporters.

FIEO said the demand for liquidity has gone up as buyers are delaying the payments and asking exporters to withhold further shipments or release small quantities of such shipments.

“There is a need to extend further credit to the export sector by automatically enhancing the limits by 20 per cent or so as given under the Gold Card scheme, at least to the established exporters, and increase the incentives under Interest Equalisation scheme to 5 per cent for manufacturer exporters and 3 per cent for merchant exporters,” he added.