New Delhi, March 2 Thanks to the continued demand revival in major markets such as the US and European Union, exports remained in the positive territory for the third consecutive month with shipments in January growing by 11.5 per cent to $14.34 billion from $12.9 billion during January 2009.
Significantly, in an indication of industrial pick-up, non-oil imports – including capital goods – grew by 28.8 per cent during January to $17.65 billion from $13.7 billion in January 2009.
Exports had declined for 13 successive months following the global financial crisis and the consequent demand slowdown in most overseas markets. But owing to the economic revival, growth in exports turned positive in November 2009 (18.2 per cent) and continued in December 2009 (9.3 per cent).
However, due to steep falls in some months, cumulative value of exports for April 2009-January 2010 was only $131.9 billion (Rs 6,29,224 crore) as against $160.44 billion (Rs 7,15,764 crore), registering a decline of 17.8 per cent in dollar terms and 12.1 per cent in rupee terms over the same period last year.
Commerce Ministry sources told Business Line that total exports for 2009-10 will be around $162-164 billion, as against around $186 billion in 2008-09.
Budget boost
In the Budget, the Government had proposed to extend the interest subsidy of 2 per cent on pre-shipment export credit for one more year (till March 31, 2011) for exports covering handicrafts, carpets, handlooms and small and medium enterprises as they are still struggling.
The scheme was not extended for leather, gems and jewellery, marine products and textiles including garments on account of their recovery from the economic slowdown. For these sectors, the scheme ends on March 31, 2010.
However, Mr A Sakthivel, President, Federation of Indian Export Organisations, has written to the Finance and Commerce Ministers saying the interest subsidy scheme should be extended by another year for the sectors that have been left out.
These sectors are highly employment intensive with very high capital employment ratio and the Government should continue to provide them interest subvention with a view to promote export as well as to encourage additional employment, he said.
Mr Sakthivel said many of these sectors are still expecting a decline in 2009-10 and few of them may have shown a positive growth but on a very low base of the previous year.
He said export sector is still facing demand compression coupled with price war on account of aggressive prices being offered by the competing countries, which have been benefiting from huge stimulus provided to them.
Total imports during January were $24.7 billion, representing a 35.5 per cent growth over $18.3 billion in January 2009. This is for second month that imports have recorded a positive growth after declining for 11 consecutive months.
This doubled the trade deficit in the month to $10.3 billion, from $ 5.3 billion in January 2009. Oil imports during January were $7 billion, 56 per cent higher than $4.5 billion in January 2009.
Source : Business Line