Updated: March 3, 2021 6:19:37 am
Having grown at the fastest pace in 22 months in January, merchandise exports slipped again in February, though marginally, continuing its roller-coaster ride in the aftermath of the Covid-19 pandemic.
Of course, growth in exports (year-on-year) may accelerate again in the coming months but that would be driven more by an ultra-favourable base effect than any meaningful recovery.
Exports had crashed between March and May 2020, as the government was forced to impose a stringent lockdown to battle the pandemic.
Between June 2020 (when the lockdown curbs started to ease) and February 2021, monthly outward shipments have risen only three times from a year before.
Exports dropped 0.3 per cent year-on-year in February to $27.67 billion, against a 6.2 per cent rise in the previous month, showed the preliminary data released on Tuesday, indicating a bumpy road to recovery.
However, what comes as partial relief is that imports rose 7 per cent on-year in February to $40.55 billion against 2 per cent in the previous months, suggesting a gradual return of domestic demand that was battered by the pandemic. This may also augur well for import-sensitive exports segments, including gems and jewellery.
Trade deficit narrowed to $12.88 billion in February from $14.54 billion in the previous month, but it’s almost 27 per cent higher from a year earlier.
Importantly, growth in core exports (excluding petroleum and gems and jewellery) — which reflect the competitiveness of the economy — slowed to 5.8 per cent in February from 13.4 per cent in January.
Growth in such imports eased only a tad to 7.4 per cent in February from 7.5 per cent in the previous month.
The data show that the overall outbound shipments until January this fiscal remained 12.3 per cent lower than a year earlier, while imports dropped at almost double the pace of 23.1 per cent.
The products that witnessed impressive growth in exports in February included iron ore (168 per cent), rice (30 per cent) and drugs and pharmaceuticals (15 per cent).
📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines
- The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.