Exports contract for 5th straight month, drop 1.8% in Dec 2019; trade deficit narrows
Imports too fell for the seventh consecutive months, down 8.83 per cent at USD 38.61 billion in December 2019 -- helping narrow the trade deficit to USD 11.25 billion, showed the government data released on Wednesday.
Gold imports shrunk by about 4 per cent to USD 2.46 billion during the month under review.
The trade deficit was USD 14.49 billion in December 2018.
Of the 30 key sectors, as many as 18 segments showed negative growth in exports during the month.
Shipments of plastic, gems and jewellery, leather products, chemicals, carpet, petroleum and engineering goods contracted by 18.14 per cent, 7.55 per cent, 5.26 per cent, 4.5 per cent, 4 per cent, 3.6 per cent, 0.57 per cent, respectively in December 2019.
The country's outbound shipments have remained subdued so far this year. It may have a bearing on the overall economic growth, which fell to over six-year low of 5 per cent in the first quarter of the current fiscal.
Industrial output declined due to poor performance by manufacturing, power generation and mining sectors.
The outbound shipments contracted by 0.34 per cent in November last year and 1.11 per cent in October.
In December last year, oil imports declined by 0.83 per cent to USD 10.69, and non-oil imports fell by 11.56 per cent to USD 27.92 billion.
Cumulatively, during April-December 2019, exports were down 1.96 per cent to USD 239.29 billion while imports contracted by 8.9 per cent to USD 357.39 billion.
Trade deficit during the period narrowed to USD 118.10 billion as against USD 148.23 billion in April-December 2018-19.
Meanwhile, an RBI release showed that services export for November 2019 stood at about USD 18 billion while imports were at USD 11.5 billion.
Commenting on the figures, Apparel Export Promotion Council of India (AEPC) Chairman A Sakthivel said the government support will help the industry to further push the exports.
"Rebate of State and Central Taxes and Levies Scheme (RoSCTL) and Merchandise Export from India scheme will five a much needed support to apparels and made ups sector," he said.
Federation of Indian Export Organisations (FIEO) President Sharad Kumar Saraf said that global and domestic factors have again led to decline in exports.
The currency volatility besides fluctuation in commodities prices including that of crude have led to the decrease in exports of petroleum, which is a major constituent of exports.
"Domestic issues including uncertainty over MEIS was a major cause of concern as exporters' claim for over five months are still pending, which has completely wiped out their liquidity and has kept them in doldrums with regard to finalising new contracts," Saraf said. RR MKJ