Country may miss its merchandise target for the second straight year as exports contracted for the first time in eight months in February even as a sharp dip in gold imports narrowed the trade deficit.
Exports declined 3.67 per cent to $25.68 billion in February, according to data released by the Government on Tuesday. The gap between exports and imports in February narrowed to $8.13 billion, the lowest level in five months, mainly on account of a 71.42 per cent decline in gold and silver purchases. Imports of the precious metals fell to $ 1.63 billion from $ 5.71 billion a year earlier.
For the April-February period, exports were up 4.79 per cent to $282.7 billion. “We have reached$ 282 billion and if we will follow the same trend as we did last March, it (exports) should be close to$ 310 billion (by end of the current fiscal),” Commerce Secretary Rajeev Kher said. India’s exports in March 2013 rose 6.97 per cent. “I will not be happy with $ 310 billion. We need to have better performance...We have not done well as we should have,” he said.
After registering a 13.47 per cent growth in October, exports recorded growth in single digits until January. Sectors contributing significantly to the export basket such as petroleum, engineering and pharmaceuticals registered a decline in February. Kher expressed hope that sectors including textiles and pharmaceuticals would do better in the months ahead.
Total imports fell 17.09 per cent to $ 33.81 billion last month. Oil imports, too, declined 3.1 per cent to $ 13.6 billion. “Credit is the biggest problem which exporters are facing. Arrears of duty refund claims have crossed Rs 20,000 crore. Global demand is there but we are unable to take advantage of this due to credit problem,” Federation of Indian Export Organisations (FIEO) President Rafeeque Ahmed said.
For the April-February period, exports were up 4.79 per cent to $282.7 billion. Imports during the 11-month period fell 8.65 per cent to $ 410.86 billion. The trade deficit during this period was $ 128 billion. Non-oil imports in February declined 24.5 per cent to $20.12 billion. During April-February, non-oil imports dipped 13.4 per cent to $ 259.02 billion. However, oil imports during the period rose 0.8 per cent to $150.63 billion.
Imports of cotton (raw and waste), vegetable oil, textile yarn fabric, fertiliser, precious and semi-precious stones, iron and steel, machine tools and electronic goods fell in February. Iron and steel and electronic goods imports contracted 26.7 per cent and 14.4 per cent to $ 582.93 million and $2.11 billion, respectively, in February.Exports of petroleum, engineering and pharmaceuticals dipped 10.36 per cent, 2.76 per cent and 1.62 per cent to $ 4.91 billion, $5.02 billion and $1.17 billion, respectively.
Gems and jewellery exports dipped 4.18 per cent to $ 3.59 billion in February. There was an increase in exports of marine products (63.3 per cent), iron ore (31.92 per cent), man-made yarn (19.57 per cent) and ready-made garments (15.54 per cent) last month.