India's exports crossed the $300-billion mark, achieving the target set by the Commerce and Industry Ministry for 2011-12.
However, the rising import bill inflated by high crude oil prices and import of gold and silver pushed the trade deficit to a whopping $185 billion, Commerce and Industry Minister Anand Sharma told journalists here.
Imports shot up by 38 per cent to $485 billion in the last fiscal.
Mr. Sharma said the export target was achieved despite lower export demand from traditional markets and the eurozone crisis as outbound shipments grew in new markets of Latin America and Africa.
“We are on course, despite the difficult global scenario and the contraction of demand in some of the traditional destinations and the eurozone crisis,'' he said, releasing the provisional trade data.
Mr. Sharma said imports increased mainly due to high crude oil prices and huge demand for gold and silver. Consequently, the trade deficit was estimated to have widened to $185 billion from $104.4 billion in 2010-11.
“Our current account deficit and the trade deficit are a challenge. Both are under stress. The country would devise a strategy in its upcoming foreign trade policy to regulate and address the growing trade gap,'' he remarked.
Commerce Secretary Rahul Khullar said the sectors that led to higher exports included gems and jewellery, textiles, petroleum, chemicals and pharmaceuticals.
Keywords: India exports, India imports, foreign trade, trade deficit
Mr. Vipul has suggsted that "The interest rate paid on Pensions and
Providend funds should not exceed GDP groth rate at the cost of majority
of Indians who are not members of such schemes". I fail to understand
what is the link between GDP growth rate and interest rate for the
Provident Funds. PF is a loan by the subscriber to Government of India
and the Government should pay a rate which is at a minimum inflation
rate + a premium for lending. Government cannot rob Ravi to pay Vipul.
The Government must introduce say about 3 % duty on Gold imports to increase its revenue and, hopefully, reduce gold demand. This duty will not encourage smuggling as the margin is small.
India should encourage recycling of gold as well.
India spends billions to import arms and military systems. Why do not we export armaments, subject to security considerations, to earn foreign exchange as well as achieve economies of scale ?
The interest rate paid on Pensions and Providend funds should not exceed GDP groth rate at the cost of majority of Indians who are not
members of such schemes .
The Government must also reduce open ended subsidies.
Perhaps the most important thing is to revive GDP growth rate by making labour laws and land acqisition more business friendly, but ensuring that a fair deal is given both to employees and seller of land.
India should find way's to curb its trade deficit by promoting exports to new region and new developing countries and also try to control it's over growth import by making a blueprint in controlling the indian Demand's.
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