India’s exports dropped for the fifth straight month, registering a drop of 1.8 per cent to end at $27.36 billion in December 2019, PTI reported.
Shipments of plastic, gems and jewellery, leather products, chemicals, carpet, petroleum and engineering goods contracted by 18.14 per cent, 7.55 per cent, 5.26 per cent, 4.5 per cent, 4 per cent, 3.6 per cent, 0.57 per cent, respectively in December 2019.
Also, 18 out of 30 key segments showed negative growth in exports during the month. Industrial output also declined due to poor performance by manufacturing, power generation, and mining sectors.
The falling exports are expected to have a bearing on the already dwindling economy which fell to a six-year low of 5 per cent in the first quarter of the current fiscal.
However, the trade deficit narrowed down to $11.25 billion due to the subsequent fall of imports during the same period. Imports fell for the seventh consecutive months, down 8.83 per cent at USD 38.61 billion in December 2019. The trade deficit was $14.49 billion in December 2018.
During the April-December 2019 period, trade deficit narrowed to $118.10 billion as against $148.23 billion during the same period in the previous fiscal.
Gold imports shrunk by about 4 per cent to $2.46 billion in December.
Meanwhile, an RBI release showed that services export for November 2019 stood at about USD 18 billion while imports were at USD 11.5 billion.
Commenting on the figures, Apparel Export Promotion Council of India (AEPC) Chairman A Sakthivel told PTI that the government support will help the industry to further push the exports. “Rebate of State and Central Taxes and Levies Scheme (RoSCTL) and Merchandise Export from India scheme will five a much-needed support to apparels and made ups sector,” he said.
Federation of Indian Export Organisations (FIEO) President Sharad Kumar Saraf said, “Domestic issues including uncertainty over MEIS was a major cause of concern as exporters’ claim for over five months are still pending, which has completely wiped out their liquidity and has kept them in doldrums with regard to finalising new contracts.”
Recently, retail inflation rose sharply to a five-and-a-half-year high of 7.35 per cent in December 2019, surpassing the central bank’s comfort range, primarily on account of rising vegetable and food prices.