Exports grow at a slower pace of 13 % in July .

Amid concerns about continued uncertainty in the European markets and slow pace of economic recovery in the U.S., Indian exports in July grew by 13.2 per cent, the lowest expansion so far this fiscal, to $16.24 billion. In July 2009, exports stood at $14.34 billion, according to the official data released on Wednesday.

The slowdown comes close on the heels of the sops announced in the annual supplement of the Foreign Trade Policy (FTP) unveiled on August 23. During the first three months of 2010-11, shipments grew by about 30 per cent.

Commerce Secretary Rahul Khullar had recently indicated that the slowdown could continue for the rest of the fiscal as the developed countries might go in for fiscal consolidation by partially rolling back economic stimulus packages.

India's exports showed robust growth rates in April (36.2 per cent), May (35.1 per cent) and June (30.4 per cent). However, officials felt that after the announcement of the sops recently for labour-intensive sectors, exports would achieve the target of $200 billion in 2010-11.

Imports in July grew by 34.3 per cent to $29.17 billion from $21.72 billion in the same period last year, indicating a rapid pace of domestic economic activity. As a result, trade deficit widened to $12.93 billion from $7.38 billion a year ago.

Oil imports increased by 4.4 per cent to $7.66 billion in July, while non-oil imports rose by 49.6 per cent to $21.50 billion.

For the April-July period, exports grew by 30.1 per cent to $68.62 billion over the same period in the previous year. Imports during the four months grew by 33.3 per cent year-on-year to $112.21 billion.

The trade deficit increased to $43.58 billion from $31.42 billion last year.

In the annual review of FTP, the government has announced various incentives, including extension of 2 per cent interest subsidy to sectors such as leather, engineering, textiles and jute. Besides, benefits under Market Linked Focus Product Scheme to garment exports to the EU were extended till March 2011.

Source : thehindu.com