The country’s export growth continues to belie the fears of a general slowdown.
Merchandise exports in June grew spectacularly for the third month in a row by rising 46.4 per cent to $29.2 billion, driven by high-end products such as engineering goods.
This is despite experts doubting the sustainability of such high growth due to uncertainty in the global markets.
“This is a very high number for exports,” said Commerce Secretary Rahul Khullar.
| EXPORT FIGURES (APRIL-JUNE) | ||
| Amount (billion $) | %Growth y-o-y | |
| Engineering | 23.0 | 93 |
| Petroleum products | 14.0 | 60 |
| Gems and jewellery | 9.3 | 19 |
| Readymade garments | 3.6 | 34 |
| Manmade yarn, fabrics | 1.2 | 30 |
| Cotton yarn fabrics | 1.5 | 9 |
| Electronic items | 2.8 | 69 |
| Pharma | 3.1 | 35 |
| Basic chemicals | 2.9 | 52 |
| Plastic items | 1.5 | 50 |
| Leather | 1.1 | 26 |
| Mica, coal and other ores | 2.7 | 270 |
| Marine products | 0.6 | 27 |
| Total | $79 billion | |
Source: Ministry of Commerce and Industry
Imports grew 42.4 per cent to $36.2 billion. A little less than one-third of this was accounted for by petroleum, oil and lubricants. The trade deficit stood at $7 billion, down from $10.55 billion a year ago.
More From This Section
Exports rose 45.7 per cent to $79 billion in the first quarter of 2011-12. With imports growing 36.2 per cent to $110.6 billion, the trade deficit for the quarter stood at $31.6 billion. The gap was less than $32.26 billion a year ago.
What is encouraging is that the growth in exports is broad-based. Engineering goods, electronic items, basic chemicals, plastic items and mineral ores were the main drivers.
“Almost all the sectors have performed very well in the first quarter,” said Khullar. He was particularly impressed with the performance of engineering goods.
Commerce Minister Anand Sharma said “the growth is steady and satisfactory and the maintained high rate of exports is encouraging.”
“There has been a perceivable shift in the export mix from traditional goods to high-end items such as engineering products, for which there seems to be a sustained demand overseas,” said Anis Chakravarty, director, Deloitte, Haskins & Sells.
In the last financial year, merchandise exports had grown 37.55 per cent to $246 billion compared with 2009-10, while imports were up 21.6 per cent at $350 billion.
The trade deficit in 2010-2011 was $104 billion. “The trade deficit continues to remain a concern in the light of high imports due to volatile commodity prices,”said Chakravarty.
The government has set a target of $500 billion worth of exports by 2014 and doubling of India’s share of global exports by 2020. “If we keep growing in excess of $79 billion (quarterly), we can achieve our target by 2014,” said Commerce Minister Sharma.
Experts doubt the sustainability of such high export growth for the rest of the year. Khullar refused to give any forecast. “We cannot summarise at this stage from the numbers available at present.”
| IMPORTS FOR FIRST QUARTER (APRIL - JUNE) Cumulative value and growth rate of imports for the first quarter of financial year 2011-12 | ||
| Amount $ bn | %Growth Y-o-Y | |
| Petroleum Products | 30.5 | 18 |
| Precious Stones | 7.5 | 10 |
| Gold Silver | 17.7 | 200 |
| Machinery | 9.0 | 49 |
| Electronics | 7.6 | 71 |
| Organic and Inorganic Chemicals | 4.5 | 19 |
| Coal | 3.7 | 27 |
| Iron, Steel | 6.7 | -10 |
| Scrap | 3.4 | 37 |
| Plastics | 1.8 | 0 |
| Fertilisers | 1.3 | -28 |
| Vegetable Oils | 2.0 | 55 |
| Transport Equipments | 2.5 | 34 |
| Total | $ 110.6 Bn | |
Note: Break-up does not include all items of import.
Despite concerns that the Duty Entitlement Pass Book (DPEB) Scheme is not being extended beyond September, the Federation of Indian Export Organisations says export growth will continue for another three months till September.
“The growth will not be as good in the third and fourth quarters and will get restricted to 35-40 per cent because of withdrawal of the DEPB scheme from October 1 this year,” he said.