JOIN USExports grew 13% in July
The slowdown in growth rate may continue for rest of the fiscal as developed countries may go for fiscal consolidation by partially rolling back economic stimulus packages, Commerce Secretary Rahul Khullar told reporters.
The rollback would contract demand in developed markets, which are the mainstay of India’s exports, he added. In any case, the growth rate has started falling as it is now being calculated on a higher base of 2009-10, after shipments started improving on signs of global economic recovery.
“(Despite) all hoopla about 30-35 per cent (export growth), the reality is 13.2 per cent (in July). Basically what is happening (is) that the base effect is wiped out,” Khullar said.
Due to low base effect, India’s exports showed robust rate in April (36.2 per cent), May (35.1 per cent) and June (30.4 per cent). Khullar further said in the second half of 2010-11, exports would shrink due to aggregate demand contraction overseas and roll back of stimulus in the developed world.
“There is going to be a slowdown in the world in the next six months...that would translate into contraction in aggregate demand of our exports,” he added. However, Khullar said India would be able to meet the export target of US$200 billion this fiscal. Exports in the last fiscal totalled US$182 billion.
“We are on track. Even if we post a 14-15 per cent growth for the remaining period of the year, we will reach US$200 billion,” he added. Due to global demand slump, country’s exports started contracting in October 2008 and entered into positive territory after 13 months in November last year. Overseas shipments in April-July this fiscal aggregated US$68.63 billion, up 30.1 per cent over same period last year.
Trade gap
Meanwhile, imports in July rose by 34.3 per cent to US$29.17 billion, taking the trade gap for the month to US$12.93 billion.
Imports during April-July period this fiscal were at US$112 billion, up 33.3 per cent over the year-ago period. The trade gap during the first four months of this fiscal is US$43.6 billion.
Oil imports during the month stood at US$7.6 billion and during April-July period, grew by 4 per cent to US$33 billion. The official figures for exports and imports would be released on September 1.
MMTC stake sale likely this fiscal
The government said it is likely to dilute its stake in trading firm MMTC through a follow-on offer in the current fiscal, reports PTI from New Delhi.
“(Disinvestment in MMTC) could happen, can be done (this fiscal),” Commerce Secretary Rahul Khullar told reporters here. The company will split its stock and announce bonus share before the public offer. The trading firm, in which government holds 99.33 per cent equity, has received mandatory EGM approval for splitting each share of face value of Rs 10 into 10 scrips of Re 1 each and issuing 1-to-1 bonus shares.