India’s merchandise exports plunged 13.9% on year in March to $38.4 billion, and imports contracted by 7.9% to $58.1 billion, official data showed on Thursday. Both onward and inward shipments have been in the negative zone in the final four months of the year, but the pace of contraction sharpened for exports in March, indicating that the global demand slump and trade headwinds have started to take a toll on India’s foreign trade.
At $447.5 billion, goods exports for the whole of the last financial year were, however, still up 6% on year, thanks to strong growth registered in the initial four months of the year. Merchandise imports grew 16.5% $714 billion in 2022-23.
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In keeping with the trend since January, trade deficit in March came in at a relatively benign $19.73 billion, as a moderate slowdown in the economy coupled with a fall in oil prices led to the relatively uncommon situation of sustained import contraction. This, however, augurs well for the current account and will ensure that the deficit in this account remains within manageable levels in the short term.
Commerce and industry minister Piyush Goyal, who was on a visit to France and Italy from April 11-13, told reporters in Rome on Thursday that India’s exports of goods and services together had scaled “new heights” and increased by 14% to $770 billion in 2022-23 as against $676 billion in 2021-22. The overall imports of goods and services touched $892 billion in the last fiscal, the minister said, adding that it reflects that the country’s economic activities are growing and that has supported the exports.
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An official statement released by the commerce ministry here said: “Under merchandise exports, 13 of the 30 key sectors exhibited positive growth in March 2023 as compared to the same period last year.” Among major sectors, these include iron ore (6.85%), drugs and pharmaceuticals (4.19%), electronic goods (57.4%), meat dairy and poultry products (3.44%) marine products (12.85%), fruits and vegetables 911.37%) and rice (10%).
Exports excluding petroleum and gems & jewellery (low value addition items) was $30.2 billion in March, closer to the level of $30.99 billion in the year ago month, indicating that the export decline was largely due to the fall in values of these products.
