Federation of Indian Export Organizations (FIEO) has termed the sharp decline in petroleum exports, as the major reason behind negative growth in the key export sectors.
As per the association, petroleum exports contribute at least 20% of the country's exports, and there was a steep decline in its export during the past sometime. Thus, the sector has become a major reason causing decline in overall Indian exports.
Commenting on the merchandise trade data for April, 2015, SC Ralhan, president, FIEO based in Ludhiana, said, “The negative growth in exports is continuing since December 2014, though the decline has come down from 21% in March, 2015 to 14% in April, 2015.”
“The prime reason continues to be softening of crude, metal and commodity prices. Petroleum exports is still showing a decline of 46.5%, which itself is responsible for an overall decline of 9% in exports, as the sector used to contribute 20% towards country's exports,” Ralhan said.
Ralhan said, “Decline in exports of rice, marine products, meat, dairy and poultry products, leather and leather products are of equal consequences, as these sectors have shown great promise in the past. Equally worrying is the negative growth in gems and jewellery, electronics and plastic goods, as domestic capabilities are being augmented in these sectors.”
He said, “However increase in exports of engineering, handicrafts, carpets, pharmaceuticals, organic and inorganic chemicals is a positive development, as most of these sectors were exhibiting a decline from January 2015 onwards.
{{/usCountry}}He said, “However increase in exports of engineering, handicrafts, carpets, pharmaceuticals, organic and inorganic chemicals is a positive development, as most of these sectors were exhibiting a decline from January 2015 onwards.
{{/usCountry}}FIEO president said, “While trade deficit has gone up marginally from 10.08 billion US dollars to 10.99 billion US dollars in April 2015, as compared to the same month last year “but a closer analysis of non-oil imports is required to see the constituent of imports as higher imports of raw-materials and capital goods may indicate little revival in manufacturing.”
Ralhan said, “The Interest Subvention Scheme may be re-introduced immediately and liquidity crunch of the exporters may be addressed with timely release of the exports benefits.”