Exports of over half of the 30 sectors closely monitored by the Commerce Ministry were in the negative zone in September, according to official data.
Overall exports in September contracted by 2.15 per cent to USD 27.95 billion mainly due to the base impact. Outbound shipments of as many as 16 key sectors — including rice, tea, coffee, tobacco, engineering, leather, spices, cashew, fruits and vegetables, marine products and gems and jewellery — dipped during the month under review, the commerce ministry data showed.
Federation of Indian Export Organisation (FIEO) President Ganesh Gupta said the negative growth in September is primarily due to high base effect last year. However, he expressed hope that the export growth would be better in the coming months as the order books are healthy.
Steps like increasing interest subsidy to 5 per cent from 3 per cent recently would give a further boost to exports, he said adding the government, however, needs to look at ensuring smooth flow of credit.
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Gupta demanded for augmentation of the flow of credit to the export sector as a sharp decline in credit when exports are growing at the double-digit does not augur well for the future. During September, important segments like engineering, readymade garments of textiles, gems and jewellery and leather exports contracted by 4.12 per cent, 33.58 per cent, 21.7 per cent and 13 per cent, respectively. These sectors contribute significantly in the country’s total outbound shipments.
Agri-products, which constitute over 10 per cent of the country’s total shipments, too recorded a negative growth during the month under review. The government is in the process of rolling out an export policy to boost shipments. Overall, eight out of 13 main agriculture products slipped into negative territory.
Exports of rice, cashew and tea fell 31.64 per cent, 29.3 per cent and 15 per cent, respectively. However, shipments of pharmaceuticals, plastic, chemicals, and electronics have recorded positive growth in September.
During April-August 2018-19, exports recorded a growth of 12.54 per cent. Imports during the period rose by 16.16 per cent, leaving a trade deficit of USD 94.32 billion in the first half of the current fiscal. Similarly, as many 12 importing sectors including silver, transport equipment, project goods, pearls, precious and semi-precious stones, and cotton raw and waste too reported negative growth in September.