The economy has started showing signs of a slowdown with the exports registering a meagre 4.3 per cent year- on-year at $24.6 billion in February. However, imports grew at a faster rate of 20.6 per cent year-on-year at $39.8 billion translating into a trade deficit of $15.2 billion during the month
Showing his concern over the ballooning trade deficit, Commerce Secretary Rahul Khullar said that since October last exports are decelerating faster than imports. ``The two biggest drivers of import bill are crude oil, gold and silver. October onwards, export started coming down sharply whereas the lag in imports deceleration was larger,’’ he said.
From a peak of 82 per cent in July, export growth slipped to 44.25 per cent in August, 36.36 per cent in September and 10.8 per cent in October, 3.8 per cent in November 2011. However, exports grew 6.7 per cent in December, and over 10 per cent in January. During April-February period, exports aggregated to $267.4 billion, a year-on-year growth of 21.4 per cent. ``Roughly speaking, exports should touch a figure of around $292-$298 billion. Imports will be close of about $480 billion and we are looking at a trade deficit in the order of $175-180 billion,’’ the Commerce Secretary said.
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During the 11-months period, oil imports increased by 41 per cent to $132.6 billion. Elaborating about the high import bill, he said: ``We have to import coal, fertiliser and vegetable oil. It is a double whammy as you are paying higher prices for these things. These are essentially demand constraints compelling us to import these goods,’’ he stated.
Mr. Khullar said that increasing import bill and widening trade deficit would put pressure on the Indian rupee. Exporting sectors which registered healthy growth in April-February include engineering and petroleum. Engineering and petroleum exports grew by 20.9 per cent and 46 per cent to $54.5 billion and $53 billion respectively. Gems and jewellery exports increased by 28.8 per cent to $40.6 billion, readymade garments by 19 per cent, electronics by 3.5 per cent, drugs by 21.4 per cent and leather by 20.4 per cent.