Exports moved out of the negative zone in January 2013 after eight straight months of decline, posting a meagre growth of 0.8 per cent to $25.58 billion, over $25.37 billion in January 2012. The widening trade deficit, which touched $20 billion during the month, however, continues to alarm the Government.
“What is worrying is the widening trade deficit. There is a substantial increase in imports of petroleum and crude, which is the main reason behind the increase in deficit,” Commerce Secretary S.R. Rao said at a press conference on Wednesday.
Rao said there was not much that could be done to put a check on imports that increased 6.12 per cent to $45.58 billion in January, but the Government was hopeful that the fresh incentive package announced for exporters last December would show results over the next few months.
“If we look at the past performance, there has been an arrest in the slide in exports. Hopefully the additional incentives that have been announced will result in a better performance going forward,” Rao said.
While declining to give a projection for the current account deficit, which shot up to 5.4 per cent of the Gross Domestic Product in the second quarter this fiscal, the Commerce Secretary said the Government would continue to boost exports to check the trade deficit.
“Petroleum and crude are the only items that have consistently posted an increase in imports over the last few months,” Director-General of Foreign Trade Anup Pujari said.
Oil imports in January 2013 increased 6.91 per cent to $15.89 billion, from $14.87 billion in January 2012 while in the 10-month period oil imports rose 11.56 per cent to $155.87 billion. Non-oil imports rose 5.7 per cent during January 2013 to $29.68 billion while in the April-January 2012-13 period they fell 5.17 per cent to $266.43 billion.
Exports in April-January 2012-13 were down 4.86 per cent to $239.68 billion. A marginal increase of 0.01 per cent in overall imports to $406.85 billion pushed up the trade deficit to $167.16 billion, compared with $154.89 billion the previous year.
A handful of products including rice, tobacco, oilmeal and carpets registered positive exports in the first 10 months of the year. The fall in exports from such top sectors as textiles and engineering was arrested, Director-General of Foreign Trade Anup Pujari said.
“For the past few months, apparel traders have tried hard to fight the crisis by improving competitiveness, seeking new markets and offering new products. The Government ‘s sops have also helped,” AEPC chairman A. Sakthivel said.