India’s exports contracted 12.7 percent for a third straight month to $34.66 billion in April, while the trade deficit fell to a 20-month low of $15.24 billion, government data showed on Monday. The fall in exports is mainly due to weak demand in India’s main destinations – Europe and the US – and it could take several months before the situation improves.
The demand scenario “doesn’t look very good as far as Europe is concerned, and we also see a fall in demand in the US. For the next 2-3 months, I think the demand scenario doesn’t look very optimistic,” DGFT (Director General of Foreign Trade) Santosh Kumar Sarangi told reporters here. However, he expressed the hope that things would change from September onwards. “There is a possibility that the opening up of the Chinese economy combined with an increase in demand in Europe and the US economy from August-September could boost global exports,” he said.
Imports also fell about 14 percent, the fifth month in a row, to USD 49.9 billion, from USD 58.06 billion in the same month last year, the data showed. The trade deficit in April last year was USD 18.36 billion. The previous lowest level was recorded in April 2021, when the deficit was $15.10 billion. On the import side, Sarangi said the decline is due to the cooling of commodity prices and reduced demand for products considered discretionary, such as gemstones and jewelry. He suggested diversifying into products for which there is higher export demand, such as electronic goods, oil meals, oilseeds and agricultural products. some technical products.
In April, export sectors recording negative growth included petroleum products, gems and jewelry, technical goods, chemicals and ready-to-wear of all textiles. However, electronic goods, pharmaceuticals, rice and oil meals recorded positive growth. Shipments of electronic goods increased 26.49 percent to USD 2.11 billion in the month under review. In exports of goods, only 11 of the 30 key sectors showed positive growth in April and in imports 23 of the 30 key sectors showed negative growth.
Crude oil imports fell 13.95 percent to USD 15.17 billion. Gold imports also shrank 41.48 percent to $1 billion in April. Indian exports to the US fell 17.16 percent to $5.9 billion in April. As in the UAE, it fell 22 percent to USD 2.23 billion in April. The other major export destinations where exports showed negative growth were China, Singapore, Bangladesh and Germany.
