Sharp deceleration in import growth to 3.8 per cent to USD 37.9 billion resulted in trade deficit narrowing to USD 13.2 billion, the lowest in the last seven months.
Reduction in trade gap would at least lessen worries arising out of sharp decline in rupee against the US dollar.
The Commerce Ministry is expected to announce some incentives for the hard-pressed labour intensive export sector when it unveils the annual supplement of the Foreign Trade Policy.
After chairing a meeting of the Board of Trade which reviewed challenges for the export sector in the wake of difficult global situation, Commerce and and Industry Minister Anand Sharma said, the target of achieving USD 500 billion shipments by end of 2013-2014 could be difficult.
However, he was hopeful that despite odds, exports would achieve a 20 per cent growth in the current fiscal.
Asked what could the government do for the export sector, given the tight fiscal conditions, Sharma said, "It is a question of supporting labour-intensive sectors. We have to take a holistic view to ensure that we should remain competitive globally. It is important for India to have a sustained thrust on exports," he said.
Finance Secretary R S Gujral, who was also present in the BoT, said: "The depreciation of rupee prima facie would help exporters in terms of higher realisation in terms of rupee... overall in the long term it would help the exporters". MORE
