KOLKATA: India's exports of engineering goods showed a sharp month-on-month fall of 14.60 per cent in November,2013 as compared to the previous month with some of the key markets like the USA not supporting the sharp recovery of shipments witnessed in the earlier months, according to the engineering exporters' body, EEPC India.
Though engineering exports show an annualised increase of 14.72 per cent in November,2013 over the corresponding month of 2012, "what is causing more concern is that they have declined month on month vis-a-vis October this year raising doubts whether recovery which began in the second quarter of this fiscal can be sustained," EEPC India Chairman Mr Anupam Shah said seeking all-out support from the government.
The engineering export basket which covers a huge variety of items ranging from motor cars, three-wheelers, bicyles, iron and steel , transport equipment and even high-tech products like parts of nuclear reactors and spacecraft, aggregated USD 4.78 billion in November this year, as compared to USD 5.6 billion. Incidentally, in October, these exports had shown a smart increase, but the momentum could not be maintained in November, as is seen in several other key areas like gems and jewellery and petroleum products.
The trend line in engineering exports is somewhat similar to the country's overall Exports story. In November, growth of India's total exports of merchandise goods eased to a five-month low of 5.86 per cent to USD 24.6 billion. A narrower trade gap has been achieved because of import compression.
"In fact, all the three top contributors to the Indian exports basket could not keep pace in November. The performance was not consistent with the previous months in regard to petroleum goods, gems and jewellery and engineering goods," Mr Shah said , raising concern over rather an erratic graph.
The key market of the USA has not been of late supportive. Shipments to the US have declined even year-on-year in November,2013 to USD 475 million from USD 514 million in the same month last year. Likewise the trend has not been very encouraging in some of the important markets of Europe. For instance, the despatches to UK dropped to USD 200 million in November,2013 from USD 287 million a year ago.
"The analysis show that engineering exports is once again falling under the negative export growth trap in November 2013 as compared to October though there have been variation in performance within the engineering sub-sectors," Mr Shah said.
Even for the cumulative period of April-November, exports to north America dropped from USD 5.1 billion to USD 4.88 billion showing a decline of 4.23 per cent.
However, the overall shipments between April-November cumulative period have increased to USD 38.85 billion from USD 36.53 billion in the same period last year.
EEPC India feels that given the present scenario, while substantive policy action may not be possible at this stage, administrative actions to prevent delays in ports, procedural bottlenecks, urgently releasing drawback refunds, particularly, in non-EDI ports should be undertaken. Further, the recommendations of the Second Task Force on Transaction Costs headed by the
DGFT should implemented as early as possible.
Source : economictimes.indiatimes.com