Exports touched $95 billion in June quarter
Indian merchandise exports touched $95 billion in the three months ended June, recording an all-time high in any single quarter, commerce and industry minister Piyush Goyal said on Friday, adding that the country is set to achieve its $400 billion export target in 2021-22. He attributed the performance, which came despite the second wave of the coronavirus disease pandemic, to excellent performance by labour-intensive sectors such as engineering goods, rice, oil meals and marine products.
Merchandise exports in the first quarter of 2021-22 jumped 16% over $82 billion in the same quarter two years ago (Q1, FY19), when compared with a normal year preceding the first wave, he said. The previous record was $90 billion in the fourth quarter of 2020-21.
The first wave of the Covid-19 pandemic and the consequent 68-day nationwide lockdown since March 25, 2020 adversely affected merchandise exports in the first quarter of the previous financial year (April-June, 2020-21) , which clocked $51 billion.
According to official data, the highest growth of 168% was achieved in iron ore exports, which touched $1.7 billion compared to the same period two years ago [Q1 FY-20]. Similarly, rice exports grew 37% to $2.4 billion. In value terms, engineering goods worth $25.9 billion were exported , a 25% jump over $20.7 billion in April-June 2019. Petroleum products saw 16% growth during this period to $12.9 billion. About 14% growth was also recorded in pharmaceutical exports , the tenth top export item, to $5.8 billion .
Commerce secretary BVR Subrahmanyam said export growth in India surpassed that in major economies such as the European Union, Japan, South Korea, the UK and the US in April 2021.
said the government has now set a $400 billion merchandise export target for the current financial year, which is over 21% higher than the record $330 billion achieved in 2018-19.
Goyal said the record performance in Q1 FY-22 was a result of PM Modi’s direct engagement with all stakeholders immediately after the Budget that ensured effective implementation of key policy announcements made on February 1. Goyal said the export performance is global recognition that India is a “trusted and reliable partner” to deliver high quality goods and services on time.
Despite a robust export performance, India’s trade deficit has grown due to higher imports. The country’s merchandise imports in April-June were $126.14 billion, an increase of 108% over $60.65 billion in April-June 2020, and a decrease of 3.05% over $130.1 billion in April-June 2019.
Petroleum import is one of the main reasons for the trade deficit . Oil import in April-June was $31 billion, a 136.36% jump compared to $13.12 billion in April-June 2020. However, India imported petroleum worth $35.36 billion in April-June 2019.
The net economic contribution of exports , net exports as a percentage of GDP , was the highest in 16 years during the quarter ending June 2020. This is basically a result of a simultaneous collapse in non-petroleum imports and crude oil prices as the pandemic ravaged the global economy and India was under a strict lockdown. India’s merchandise trade deficit was $30.7 billion in the quarter ending June , lower than the $41.1 and $35.1 billion figures for the quarters ending March 2021 and December 2020.
While complimenting government policies for a robust growth in exports, Federation of Indian Export Organisations (FIEO) president A Sakthivel said increase in both quarterly and monthly imports should be looked into.
Sakthivel, who is also the chairman of the Apparel Export Promotion Council (AEPC), said: “India’s economic recovery is likely to be led by exports till domestic demand picks up. And, leading the pack of exporters will be the MSMEs [micro, small and medium enterprises], as exports need personalised management.”
Confederation of Indian Industry (CII) director general Chandrajit Banerjee said: “Driven by structural reforms and positive sentiments about Indian goods, the milestone of highest-ever merchandise exports strongly demonstrates the growing importance of the country in global supply chains.”