December 2, 2020: India’s exports have rebounded in recent months as the global economy slowly opened up after a Covid-induced shutdown, but the pickup in outbound shipments has lagged that of other Asian economies. Comparative data of export growth on a three-month moving average basis showed that Vietnam, China and Taiwan have seen the strongest revival, followed by Bangladesh. India and Indonesia have lagged. A moving average is used as it helps smooth out short-term fluctuations over a given time frame.
Vietnam, an exporter of electronics, textiles and machinery, among other items, saw exports rise by 12% on a three-month moving average basis, according to data from DBS Bank. China and Taiwan have seen close to double-digit growth too. Bangladesh has seen 1.3% growth in exports on a three-month moving average basis.
India’s export performance has been patchy. The contraction in shipments started to ease in June and exports returned to growth in September. Outbound shipments fell once again in October, dropping 5%.
Asia’s recovery is led by China, and China’s recovery is led by exports, which have been above pre-Covid levels since mid-year, said a November 2020 research note by Moody’s Analytics. Acceleration in China’s international trade is being felt elsewhere in the Asia-Pacific region, it said, adding that Vietnam, Singapore, Taiwan, Malaysia and New Zealand are other Asia-Pacific economies that have reported a sharp rise in exports.
In India, like in Japan, Thailand, Philippines, and Indonesia, trade is rising slowly but is not yet at pre-pandemic levels, the report said.
Radhika Rao, economist at DBS Bank, said there is a clear updrift in regional export performance this year notwithstanding the pandemic. But the extent of buoyancy differs across countries, with China, Taiwan and Vietnam among the front-runners.
A key differentiator in export performance is the extent of existing integration in global supply chains, said Manoj Pant, director of the Indian Institute of Foreign Trade. Countries like Vietnam have benefitted because of this, Pant said.
Source: Bloomberg Quint
