India's exports miss target; trade deficit narrows
New Delhi: India's exports grew by a sluggish 3.98 percent to $312.35 billion in financial year ended March, missing the official target of $325 billion, while trade deficit narrowed on lower imports.
According to data released Friday by the ministry of commerce and industry here, exports stood at $312.35 billion in the financial year 2013-14, up 3.98 percent from the previous year's $300.40 billion.
Total value of imports for the fiscal 2013-14 was $450.94 billion, 8.11 percent lower from $490.73 billion recorded in the previous year. Trade deficit for the fiscal ended March 31, 2014, was substantially lower than in the previous year. Trade deficit narrowed to $138.59 billion in 2013-14 from $190.33 billion recorded in the previous year.
“Factors which could be attributed for slowdown in exports are exchange rate volatility, steep hike in global oil prices, curb on gold imports coupled with its direct impact on jewellery export,” said Sanjay Budhia, chairman of CII export committee.
Budhia said global factors like tough economic situations in the US and Europe also led to the slowdown in exports growth.
Imports declined due to a sharp drop in gold imports as the policymakers put curbs to discourage demands for the precious metal. This has helped narrow the country's current account deficit that had risen to an alarming level of $88 billion.
However, the monthly figure was disappointing. Trade deficit widened to $10.50 billion in March from $8.13 billion in the previous month due to lower exports. The country's exports fell by 3.15 percent to $29.57 billion in March as compared to $30.54 billion recorded in the same month of last year.
Imports dropped by 2.11 percent to $40.08 billion in March, leaving the monthly trade gap of $10.50 billion. Oil imports in March were valued at $15.78 billion, which was 17.7 percent higher than oil imports valued at $13.40 billion in the corresponding period last year.
For the whole fiscal 2013-14 oil imports were valued at $167.62 billion, 2.2 per cent higher than the oil imports bill of $164.04 billion in the previous year.
Non-oil imports in March 2014 dropped by 11.8 percent year-on-year to $24.30. For the fiscal 2013-14, non-oil imports declined by 13.3 percent to $283.32 billion.
“It is worrisome that our exports fell by more than 3 percent in each of the last two months and we have missed the export target of $325 billion,” said Arbind Prasad, director general of FICCI, while expressing concern over the decline in exports.
Prasad said India's exports are likely to pick up in the current fiscal on the back of recovery in the global economy.