India’s merchandise exports grew 2.6% on year to $35.2 billion, on a very weak base (-19%), official data showed on Monday, indicating that the shipments are yet to come out of the woods. The exports had risen 12.8% in May, causing the government to predict a revival after nearly two years of stagnant trade, even as that growth too was on a shrunken base (10.4%).
Exports ascribed the continued sluggishness to logistics disruptions like lack of availability of containers, shipping space, irregular shipping schedules and ships skipping Indian ports. Without these disruptions, exports would have recorded a double-digit growth, Federation of Indian Export Organisations (FIEO) president Ashwani Kumar claimed. Officials from the ministry of commerce, however, discounted the issue of shortage of containers.
Imports in June were up 4.9% on year to $56.18 billion driven by petroleum and electronics, while there was a sharp 17% contraction a year ago. The trade deficit widened 9.3% on year to $20.98 billion. In May, it stood at $22.3 billion, the highest level since August 2023 ($24.3 billion).In the April-June quarter, goods exports climbed 5.84% to $109.96 billion and imports grew 7.6% to $172.23 billion, both helped by favourable bases. The trade deficit in April-June widened to $62.26 billion against $56.16 billion a year ago.
Services exports grew 8.9% on year to $30.27 billion while imports were up 10.7% to $17.29 billion. Services exports in April-June stood at $90.37 billion, up 12.16%. Cumulatively, goods and services exports crossed $200.33 billion in the first quarter of 2024-25.“If the current trend continues, we will certainly cross $800 billion in exports (of both services and goods) this fiscal,” commerce secretary Sunil Barthwal told reporters. The major drivers of the exports in the June were engineering, electronics, pharmaceuticals, coffee and chemicals.
Engineering exports were up 10.2% to $9.4 billion, electronics exports grew 16.9% to $2.8 billion, pharma exports were up 9.9% to $2.4 billion while chemical exports grew 3.3% to $2.3 billion.The government is focusing on six sectors — engineering, textiles and apparel, electronics, pharmaceuticals, chemicals and plastics, and agriculture — and 20 key countries to boost exports, Barthwal said.
The US, the UAE, the Netherlands, the UK and China were the biggest export markets in June while the biggest source of imports were China, Russia, the UAE, the US and Iraq.