India’s merchandise export grew 3.9 per cent to 22.54 billion in July, marking an annual increase in shipments for the 10th straight month, but slower than the 4.4 per cent growth posted in the previous month.
The growth of imports, despite continued surge in the influx of gold, slowed in July to an annual 15.4 per cent from 19 per cent in the previous month, precipitating a narrower trade deficit of $11.45 billion. The trade shortfall was $12.96 billion in June. India imported goods worth $33.99 billion last month, as against $36.52 billion in June.
As for exports, engineering goods (up 15.2 per cent), petroleum products (20.3 per cent) and chemicals (20.7 per cent), performed well in July, but several other sectors reported contraction. Pharmaceutical exports declined 5.4 per cent year on year, apparel exports fell 12 per cent and gems and jewellery saw a 22.7 per cent fall.
South Korean imports via the FTA route had seen gold imports surge 104 per cent to $2.45 billion in June. The imports saw 95 per cent rise in July to $2.1 billion.
“…the need of the hour is the sectoral analysis which should be initiated soon to pin-point factors responsible for decline in (exports from many sectors),” Ganesh Kumar Gupta, president of Federation of Indian Export Organisation (Fieo), said.
Oil imports were valued at $7.84 billion in July, an increase of 15 per cent over the same month in 2016. Cumulative import during April-July increased by 28.3 per cent to $146.25 billion, leaving a trade deficit of $51.5 billion.
Fieo has also cautioned that the order booking position October onwards is not very promising and the appreciation of Indian currency with increasing pressure on liquidity under the goods and services tax may affect exports in the last quarter of 2017 bringing exports to $310 billion in the current fiscal.