A fall in exports of engineering goods, petroleum products and gems and jewellery along with a demand slowdown in the US and Europe pulled down India’s exports growth by 9.7 % year-on-year to $22.3 billion in August compared with $24.7 billion in the year ago period.
Exports have dipped continuously in four of the last five months. Imports during the month, too, slipped by 5.08% to $38 billion compared with $40 billion in the corresponding period last year.
Petroleum, gold and silver, machinery, electronic goods and coal were the major imports in the month.
As a result, the trade deficit widened to $15.7 billion from $15.5 billion in July.
During April-August, the shipment dipped by about 6% to $120 billion from $127.6 billion in the same period last year. M Rafeeque Ahmed, president, Federation of Indian Export Organisations (FIEO) said that the export data is on expected lines and that contraction in global demand and deceleration in manufacturing sector are primary reason for decline in exports.
During the first five months of the current fiscal, imports contracted by 6.2% to $191.1 billion.
Gold imports almost halved in the period. Trade deficit during the period under review stood at $ 71.1 billion. ?The trade gap is well under control,? said commerce secretary SR Rao adding that there is a slight ray of hope after the dramatic fall in July and in the otherwise depressing global trade.
?We have to watch for a couple of months more. Checks and balances are in place though there is a contraction in global demand alongside. All core sectors are showing contraction today. The outlook on all core sectors in bleak globally,? Rao added.
Rao said the incentives announced in the foreign trade policy (FTP) was the reason for this.