Exports have registered a sharp increase of 32.4 per cent on year-on-year basis in January to $20.61 billion ($15.56 billion in January 2010), backed by fresh demand in the U.S. and Latin American markets.
If the present trend continues in the next two months of this fiscal, exports are likely to surpass the $200-billion target and end the fiscal with $225 billion shipments.
During April-January 2010-11, outbound shipments grew by 29.3 per cent to $184.63 billion ($142.74 billion), data released by the Commerce Ministry on Tuesday stated.
The Federation of Indian Export Organisations (FIEO) said exports were increasing in new markets of Latin America and Africa, along with the U.S. and especially within Asia. “The January number is a huge jump. The strategy of going beyond the traditional markets of the U.S. and Europe was paying rich dividends, FIEO President Ramu S. Deora said.
The government has given incentives to exports for those wanting to explore African and Latin American markets. At a post-budget FICCI function, Finance Minister Pranab Mukherjee said there were several external factors that posed challenges to the Indian economy. “Global recovery remains fragile. There is also the danger of sovereign debt crisis in peripheral euro zone countries spilling over to financial markets,'' he stated. As per the data, imports grew by 13.1 per cent during the month under review to $28.59 billion ($25.27 billion), resulting in a trade deficit of $7.98 billion.
The Commerce Ministry has recently sought public comments on its strategic paper to double exports to $450 billion in the next three years. As per the Ministry, the sectors that performed well in the ten months of the current financial year include gems and jewellery (up 9.3 per cent), engineering (up 70 per cent) and petroleum and oil lubricants (up 36 per cent).
Exporters are witnessing huge demand for engineering products from Latin American countries such as Colombia.
On the import front, oil imports grew by 7.8 per cent to $7.85 billion in January, taking the import bill during April-January, 2010-11, to $79.96 billion. Non-oil imports grew by 23.8 per cent to $20.73 billion during the month under review. Imports of non-oil items were up 19.2 per cent during April-January to $193.64 billion from $162.4 billion in the same period last year. Oil and non-oil imports totalled $273.59 billion in April-January, thus, taking the trade gap to $88.96 billion. This is marginally lower than the $89.84-billion deficit recorded in the same period of 2009-10. The government expects the trade gap to be in the range of $105-110 billion by the end of this fiscal.