India’s exports rise after a prolonged slump

India’s merchandise export growth turned positive for the first time in the current financial year with a 3.86% year-on-year rise in August at $38.45 billion, Commerce Secretary Sunil Barthwal said, citing revised figures that broke a monthly contraction sequence which started in February 2023 due to global headwinds.

Initial data released on September 15 reported a 6.86% y-o-y dip in merchandise exports in August to $34.48 billion. Officials said revisions of export figures are normal as some consignments that miss the customs radar are updated later.

Commenting on the overall (merchandise and services combined) trade performance, Barthwal said “green shoots” are visible on the export front, despite global headwinds and adverse geopolitical developments. According to the latest data, the fall in overall exports (merchandise and services combined) in April-September 2023 has narrowed to 2.97% on an annualised basis. Overall imports during the period are estimated to contract 10.14% over April-September 2022, it said. As actual services data comes with a lag, figures for services in September are an extrapolation of the previous month’s data.

Barthwal said “there is optimism” for the coming months since the services sector is doing well, and the fall in merchandise exports has tapered. “Weekly trend is also positive in October (2023),” he said, adding that India’s exports may see a positive growth in FY24.

Indian merchandise exports year-on-year dipped by 2.6% to $34.47 billion in September 2023, while imports also fell by 15% to $53.84 billion, the 10th monthly decline in a row. This led to narrowing of the merchandise trade deficit to $19.37 billion in September, the lowest in five months.

Merchandise exports contracted by 8.77% to $211.4 billion in the first six months of current financial year (April-September 2023), the data showed. Imports also fell by 12.23% to $326.98 billion during this period with a trade deficit of $115.58 billion.

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