Exports continue the robust growth at 36.3 per cent

Even as India’s exports continued to maintain a robust growth registering a 36.3 per cent growth at $24.8 billion in September despite the downturn in the U.S. and Euro zone, signs of deceleration have already started to set in.
The total exports for the current fiscal may reach a striking range of $290-300 billion, Commerce Secretary, Rahul Khullar said on Wednesday. The exports were down from the 44.2 per cent growth recorded in August. However, the rise in exports in September can be considered robust, given the economic woes in the U.S. and the debt crisis in Europe. The U.S. and Europe are the two biggest markets for Indian merchandise, accounting for about 30 per cent of total shipments.
Imports in September grew by 17.2 per cent to $34.6 billion vis-a-vis the same period last year, leaving a trade deficit of $9.8 billion. During the April-September period, India’s exports grew by 52.1 per cent to $160 billion. “Good news is that exports continue to grow over last year, but the heady numbers have gone, it is clear there is deceleration,” he told reporters here. During the first half of this fiscal, the sectors which registered a healthy growth include engineering (103 per cent), petroleum and oil lubricants (PoL) (53 per cent), gems and jewellery (23 per cent), ready-made garments (32 per cent), marine products (48 per cent) and drugs (33 per cent).
Mr. Khullar said that India’s exports are growing in new markets such as Africa, Latin America and Asia, which have helped it maintain the export growth momentum. During the period, imports expanded by 32.4 per cent to $233.5 billion. The trade gap stood at $73.5 billion.
The Federation of Indian Exporters Association (FIEO) said the trade deficit number is huge and may touch $150 billion by the end of 2011-12 which is a matter of concern. During April-September 2011-12, PoL imports grew by 42 per cent to $70.4 billion year-on-year. Mr. Khullar said this growth is largely because of the price effect.
Other sectors which reported healthy imports growth include gold and silver (80 per cent), machinery (34 per cent), coal (43 per cent), vegetable oil (60 per cent) and electronics (33 per cent).
Talking about diversification of markets, the Commerce Secretary said that in the last six years India’s export and import destinations have shifted from traditional markets to new regions. While exports to the North America (the U.S. and Canada) declined to 11 per cent from 18 per cent, the country’s shipments contracted to 19 per cent from 22 per cent during 2004-05 and 2010-11. “Earlier North America and Europe accounts for 40 per cent of the country’s exports and now this share has come down to 30 per cent, a gap of 10 per cent is really huge,” he said.
During the period, in Africa, India’s shipments grew by one to 8 per cent. Exports to West Asia, North East Asia and Latin America increased to 20 per cent, 17 per cent and 4 per cent from 16 per cent, 15 per cent and 3 per cent, respectively. Similarly, the country’s imports from North America and Europe declined to 6 per cent and 12 per cent from 7 per cent and 17 per cent respectively, he added.
Imports from North East Asia went up to 21 per cent from 15 per cent. “In this region, a large part of our imports are coming from China and Korea,” he said.
Commenting on India’s changing exports basket, he said the shipments of traditional sectors such as gems and jewellery and textile are declining. Exports of gems and jewellery and textile declined to 15 per cent and 9 per cent between 2004-05 and 2010-11 from 17 per cent and 12 per cent, respectively.
Engineering and petroleum product exports saw a huge jump of 24 per cent and 17 per cent from 18 per cent and 8 per cent, respectively. Electronics exports went up to 4 per cent from 2 per cent during the period.