Exports recorded an impressive 46.4 per cent rise at $29.2 billion in June and grew by a hefty 45.7 per cent in the first quarter of the current fiscal, notwithstanding uncertainty in the European markets and slow recovery in the U.S.
During April-June quarter, shipments grew by 45.7 per cent at $79 billion.
“Exports are steady. They are growing satisfactorily,'' Commerce and Industry Minister Anand Sharma told reporters here on Friday after the release of trade data.
Although majority of the sectors posted a robust growth, be it petroleum products, ready-made garments, engineering or pharmaceuticals, Commerce Secretary Rahul Khullar cautioned that news from the largest two markets — the U.S. and Europe — was far from cheerful. “Summer is not over. It is still not going to be easy,'' he said.
The U.S. and Europe together account for about 35 per cent of the country's exports, which stood at $246 billion in 2010-11.
Mr. Sharma said he was looking 25 per cent growth annually so that exports touch $500 billion in 2013-14. Imports too increased by 36.2 per cent to $110.6 billion, led by $30.5 billion worth imports of petroleum products in the April-June quarter. Though imports grew by 42.4 per cent to $36.9 billion in June, the trade deficit of $7.7 billion was almost half of $14.9 billion in May, lessening concerns over the country's balance of payment situation.
The Federation of Indian Exporters Organisation (FIEO) said the high growth trend of exports was unlikely in the third and fourth quarters, as there were concerns over inflation and high interest rates.
“The 25 basis point hike in interest rates by State Bank of India will increase the cost of export finance. It will badly go against exports that will get reflected in the October data,'' FIEO President Ramu S. Deora said.
Mr. Sharma said he had taken up the issue with Finance Minister Pranab Mukherjee and had also discussed about replacement of the popular export benefit DEPB scheme with a robust scheme. “Bank rates have been rising over the last one year. There is need to consider a differential rate of credit for the exporters. The Finance Minister is fully apprised of the matter and we hope that some relief will be there. Hopefully soon a decision would be taken in this regard,'' he added.
On the duty drawback issue, he said: “we will be able to offer something which is useful for the exporters.''
Under the DEPB scheme, which was extended till September, exporters are given refunds of tax incidence on the import content of their export products.
The scheme is the most popular among exporters, especially in the engineering sector, including the automobile industry.
The sectors that registered healthy growth in exports in the first quarter include engineering (94 per cent), petroleum products (60 per cent), gems and jewellery (19 per cent), readymade garments (34 per cent), electronics (69 per cent), chemicals (52 per cent) and plastics (50 per cent).