Exports fall for 3rd consecutive month by 12.7% in April; trade deficit at 20-month low

In April 2022, the trade deficit stood at $18.36 billion. The lowest level prior to that was in April 2021, when the deficit stood at $15.10 billion.

The decline in exports is mainly on account of poor demand in India's key destinations -- the Europe and the US -- and it may take some more months for the situation to improve.(Representational/file)

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For the third month in a row, Indian exports contracted, declining by 12.7 per cent to $34.66 billion in April, while the trade deficit reduced to a 20-month low of $15.24 billion, according to the government data released on Monday.

The demand scenario is “not looking very good as far as Europe is concerned, and the US also we have seen a decline in demand. For the next 2-3 months, I think the demand scenario does not look very optimistic,” DGFT (Director General of Foreign Trade) Santosh Kumar Sarangi told reporters. The situation may improve from September onwards, he added.

“There is a possibility that opening up of Chinese economy combined with some boost in demand in the Europe and the US economy from August-September onwards might give a boost to global exports,” he said.

Meanwhile, imports too declined by about 14 per cent for the fifth month in a row, to $49.9 billion, against $58.06 billion recorded in the same month last year.

In April 2022, the trade deficit stood at $18.36 billion. The lowest level prior to that was in April 2021, when the deficit stood at $15.10 billion.

Exports fall for 3rd consecutive month by 12.7% in April; trade deficit at 20-month low

Sarangi said that the decline in imports is due to the cooling down of commodity prices and reduced demand for discretionary products, such as gems and jewellery.

He suggested to diversify into products which have higher export demand, such as electronic goods, oil meals, oil seeds, and agricultural goods.

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In April, export sectors which recorded negative growth, included petroleum products, gems and jewellery, engineering goods, chemicals and ready-made garments of all textiles.

But, electronic goods, pharma, rice and oil meals registered positive growth. The shipments of electronic goods rose by 26.49 per cent to $2.11 billion in the month under review.

Under merchandise exports, only 11 of the 30 key sectors exhibited positive growth in April and at imports front, 23 out of 30 key sectors recorded negative growth. Crude oil imports dipped by 13.95 per cent to $15.17 billion. Gold imports too contracted by 41.48 per cent to $1 billion in April.

As per the ministry data, exports of goods and services in 2022-23 increased by 14.68 per cent to $775.87 billion as against $676.53 billion in 2021-22.Services exports in April this year were estimated at $30.36 billion, as compared to $24.05 billion in April 2022. With PTI inputs