Goods exports declined for the fifth straight month in April, falling 13.96 per cent to $22.05 billion as demand from key markets remained subdued.
The dip in merchandise exports, which account for about 16 per cent of India's roughly $2-trillion economy, is likely to tell on the economic growth.
Painting a grim picture, exporters’ body FIEO said that the booking position of exporters has worsened compared to December 2014, when exports had first started falling.
This also raises questions on the feasibility of the Narendra Modi Government’s target of achieving over 8 per cent growth in 2015-16.
Imports during the month fell 7.48 per cent to $33.04 billion due to a sharp fall in the oil bill. But the trade gap widened to $10.99 billion from $10.1 billion in the previous fiscal year. “The interest subvention (subsidy) scheme should be reintroduced immediately and the liquidity crunch facing exporters addressed with timely release of export benefits,” FIEO President SC Ralhan said, stressing the need for cheaper credit to stay competitive in the global market.
While the Centre announced the reintroduction of the interest subsidy scheme in the Foreign Trade Policy last month for three years, it has not yet been implemented as the sectors to be covered are yet to be finalised.
Petroleum products, gems and jewellery, electronics, plastic goods, meat, marine products, coal and minerals and oil-meal were some of the export items that took a hit in April.
While country-specific export data are not yet available, a Commerce Ministry official said shipments to the EU, Japan, the Asean region and China were likely to be low. Exports to these markets fared badly in 2014-15.
Goods exports in 2014-15 were down 1.23 per cent from the previous year, at $310.5 billion. Oil imports in April, at $7.44 billion, were 42.65 per cent lower than last April. Non-oil imports were up 12.58 per cent at $25.6 billion.
Gold imports rose 78.33 per cent to $3.1 billion, while that of silver fell 31 per cent to $0.32 billion.
Import of project goods remained flat in April, while that of machine tools fell.