Low global demand pulls January export by 11.19%, a 2-½ year low

Trade deficit hits 11-month low in January to $8.32 billion on crude price drop.

India’s export fell 11.19 per cent in January, the steepest decline in two-and-a-half-years, while the imports contracted 11.39 per cent year-on-year during the month amid the softening of crude and commodity prices and developed economies, except the US, awaiting revival.

The figures released by the commerce and industry ministry show that the exports during the month stood at $23.88 billion as against $26.89 billion during the same month in the last fiscal while the imports stood at $32.21 billion compared to $36.34 billion during the corresponding period last fiscal.

However, India’s trade deficit narrowed to a 11-month low of $8.32 billion in January as oil imports declined by 17 per cent from a month earlier, the data showed.

“The data has been very disappointing. The reasons are both domestic and global. Except the US, other economies are yet to pick up while what has also impacted the exports is the moderation in crude and commodity prices. Even though the volume has remained the same, the price came down impacting exports,” Ajay Sahay, director general, Federation of Indian Export Organisation (Fieo), said.

As regards the domestic concerns, Sahay said that while the exporters have not been receiving interest subvention on time, lack of clarity on the foreign trade policy (FTP) has also impacted the exports.

“Without the FTP, exporters have not been able to do their costing and take positions. In fact, over the last 3-4 years, exports have averaged around $300 billion, without showing any significant growth. This year also, we expect that it will be around $325 billion only,” Sahay said.

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Almost all sectors including tea-coffee, rice, spices, tobacco, oil meals, cereals preparations, marine goods, meat and dairy products, gems and jewellery, drugs and pharmaceuticals, organic and inorganic chemicals, electronic goods, textiles (other than RMG), jute, plastic products and petroleum products have exhibited a decline trend, he added.

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During the month, exports of oil seeds posted a growth 85.77 per cent, ceramic products 24.75 per cent, engineering goods 9.26 per cent, ready-made garments of all textiles 8.95 per cent while carpet recorded a growth of 14.14 per cent. Export of petroleum products declined 48.69 per cent in January.

Similarly, import of pearls and semi precious stones declined 30.73 per cent while that of petroleum products declined 37.46 per cent. Import of gold and silver, however, increased by 8.13 per cent and 29.23 per cent respectively.

Oil imports during the April-January period stood at $124.74 billion, down 7.87 per cent compared to the same period last year. Non-oil imports during the 10-month period was $258.66 billion, up 7.84 per cent year-on-year.