 "Exports up in double digits for third month in row in September")
Pushed up by the rupee depreciation and recovery in overseas demand, merchandise exports surged by double digits in the third straight month to clock 11.15% growth at a six-month high of $27.68 billion dollars in September this year against $24,90 billion in the same month of 2012-13. On the other hand, imports fell by a whopping 18.10% to touch 30-month low of $34.43 billion dollars against $42.05 billion as the government compressed inbound shipments of precious and non-essential products.
Consequently, trade deficit fell to the lowest level in two-and-a-half years at $6.76 billion, providing some respite to the government struggling hard to bring down current account deficit which touched 4.9% of GDP in the first quarter of the current financial year.
Consequently, trade deficit fell to the lowest level in two-and-a-half years at $6.76 billion, providing some respite to the government struggling hard to bring down current account deficit which touched 4.9% of GDP in the first quarter of the current financial year.
According to official figures released here today, exports were up 5.14% at $152.10 billion in the first six months of the current financial year against 144.67 billion dollars. This prompted commerce secretary S R Rao to tell reporters that at least exports target of $325 billion during 2013-14 would be met against $300 billion in the previous financial year. He, however, did not forget to say that exporters body Federation of Indian Export Organisations (FIEO) is optimistic that outbound shipments would reach $350 billion in 2013-14.
Before September, exports were up 13% in August and 11.64% in July, after contracting for two straight months of 2013-14. In April, exports had inched up 1.68%.
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Imports, on the other hand, declined 1.8% at $23.22 billion during April-September, 2013-14 against $23.65 billion in the corresponding period of the previous fiscal. This largely happened as the government tightened imports of precious metals and non-essential items. The finance ministry had hiked import duty on gold to 10% from earlier eight% in August, while also raising the duties on inbound shipments of platinum, silver and flat screens.
Consequently, imports of gold and silver declined sharply by 82% at $0.8 billion in September this year against $4.6 billion in the same months last year. For the first six months, imports of these precious items rose 8.71% to touch $23.1 billion against $21.2 billion a year ago.
This led to a massive 24.19% decrease in imports of non-oil products at $21.24 billion in September, 2013-14 against $28.02 billion in the same month of the previous year. These imports contracted 4.55% at $149.35 billion in the first six months of the current financial year against $156.48 billion in the corresponding month of the previous financial year.
Not only that oil imports too fell in September year-on-year due to softening global crude prices, which is a rarity in India's trade numbers. These imports were down almost 6% at $13.19 billion in September against $14.03 billion in the same month a year ago. For the first six months, imports were up 3.58% at $82.88 billion against $80.01 billion a year ago.
As such, trade deficit was lower by over 14.5% at $80.13 billion in April-September 2013-14 against $91.82 billion in same months a year ago.
Rao refused to peg trade deficit figures for 2013-14 as a whole. However, Yes Bank analysis projected it to fall to $179 billion for the current financial year against $196 billion in 2012-13.
The widening trade deficit had broadened current account deficit to $88 billion or 4.8% of GDP in 2012-13. This year, the government expected CAD to come down to $70 billion or 3.7% of GDP. The government can take comfort from the fact that Yes Bank pegged it at $60 billion for 2013-14.