India’s exports fell 5.45% in June, the second successive month of contraction, as the prolonged slowdown in key markets such as Europe and the United States hurt shipments from India.
Data released by the commerce and industry ministry showed exports in June stood at $25.07 billion compared to $26.51 billion in the same year-ago month.
Imports also registered a sharp decline in June posing a fresh worry for the government already battling to revive growth and sentiment which have been dented due to a slew of policy flipflops and delays. Imports in June fell 13.5% to $35.37 billion. The balance of trade narrowed to $10.3 billion.
The slowdown in the country’s traditional markets has hurt India’s exports. The scorching growth rates witnessed last year have moderated. In April, exports rose 3.23% while imports rose 3.83%. The government has been banking on its market diversification programme to tide over the tough global economic situation. Economists said the decline in imports pointed to a sharp slowdown in the economy.
Industrial output data showed that the capital goods sector fell 7.7% reflecting a slowdown in economic activity. Overall growth slowed to a nine-year-low of 5.3% in the January-March quarter of 2012 prompting calls for urgent action to revive growth. The cumulative figure for April-June 2012 shows exports stood at $75.20 billion, a decline of 1.7%, while imports posted $115.26 billion, a fall of 6.10%.
Government officials have been saying that 2012-13 would be a tough year for exports due to turbulence in the global economy. Exports crossed the $300 billion target set for 2011-12 and the government has set a target of $360 billion for the current fiscal but some experts say it would be a difficult task to meet the target. During June 2012, rice exports rose 104%, iron ore 40%, oil meal 38% and spices 35%.
In percentage terms, during the quarter, rice registered a growth of 73%, spices 32%, drugs 13.4%, oil meal 13.2% and fruits and vegetable 9.53%, a government statement said. In June, medicine exports rose 14.7%, vegetable oil 8%, iron and steel 7.9%, professional equipment 8.5% and artificial resin (5%), the statement added.