Exports up by 18% in November

Exports up by 18% in November

Turn positive for the first time after 13 months

Exports in November 2009 increased to US$13.19 billion from US$11.16 billion a year ago marking a trend reversal of decline that had set in since October 2008 due to widespread recession in key global markets.

Imports remained in the negative zone declining by 2.6 per cent to US$22.88 billion, leading to a lower trade gap of US$9.69 billion during the month against US$12.32 billion in November 2008.

However, the import contraction in November was much lower than 15 per cent in October, signifying pick up in the economic activity.

For the April-November period, exports dropped by 22.3 per cent to US$104.24 billion, much lower than 26 per cent gap up to October this fiscal. While exports have turned positive partly due to low base of last year, experts cautioned against complacency.

“Exporters need to keep their competitiveness both in terms of quality and prices and focus on market and product diversification,” R M Joshi of the prestigious Indian Institute of Foreign Trade said.

Stimulus should stay

ICRIER Director Rajiv Kumar said government stimulus should continue and exporters need to be cautious about the exchange rate volatility.

India’s apex exporters body Federation of Indian Export Organisations (FIEO) said the November data indicates the adaptability of exporters to the changing global economy and the positive impact of the stimulus extended by the government.

FIEO President A Sakthivel hopes that the government would continue with the stimulus, particularly interest subsidy for exports. Despite the positive growth, the country’s overseas shipments in the current fiscal are likely to remain much lower than the US$185 billion worth of shipments last year.

As per the FIEO estimates, exports in 2009-10 are expected remain in the range of US$165–170 billion.

Meanwhile, India’s oil imports also turned positive after 13 months and increased by 7.3 per cent to US$6.38 billion in November compared to US$5.95 billion a year ago. The imports during April-November were US$50.18 billion, 34.4 per cent lower than US$76.52 billion in the year ago period. The non-oil imports contracted by 5.9 per cent to US$16.5 billion from US$17.5 billion in November 2008-09.

As per the data, non-oil imports were 23.8 per cent lower at US$120.2 billion in April-November 2009-10 than the US$157.8 billion in the comparable figure last year.
Trade gap during the first eight months of the current fiscal was US$66.18 billion compared to US$100.15 billion in the same period last year.