India’s goods exports faced a continuous decline, marking the seventh consecutive month of downturn in August 2023. The year-on-year data revealed a 6.86% decrease, plummeting to $34.48 billion. Key sectors like petroleum products, gems and jewellery, readymade garments, and chemicals were major contributors to this decline.
Positive Indications Amidst Decline
- Despite the overall decrease, half of the top thirty export items, including engineering, electronics, pharmaceuticals, and select agricultural goods, experienced growth in August.
- This positive trend sparked optimism within the government about future prospects.
Imports Witness a Downturn
- Imports in August 2023 exhibited a decline of 5.23%, amounting to $58.64 billion.
- This fall was primarily attributed to reduced imports of petroleum, coal and coke, pearls, precious and semi-precious stones, and fertilizers.
Trade Deficit at a Ten-Month High
The trade deficit in August 2023 reached a ten-month high, stagnating at $24.16 billion, a figure consistent with the same period in 2022.
Signs of Stabilization and Growing Optimism
- Commerce Secretary Sunil Barthwal expressed confidence, noting that exports were stabilizing.
- The initial pessimism was transforming into optimism, with visible green shoots in the market.
- Non-petroleum exports in August 2023, totaling $28.60 billion, nearly mirrored the previous year’s exports, reinforcing the growing optimism among market players.
Industry’s Positive Outlook
- Some exporters shared the optimism, with engineering goods exports finally turning positive after eight consecutive months of decline.
- Industry leaders anticipated a resurgence in engineering exports in the upcoming months, citing improving global demand conditions and diminishing geopolitical concerns.
Future Prospects: Expectations of Improvement
- Industry experts and leaders voiced confidence, foreseeing better growth numbers in the coming months.
- Anticipated fresh orders and bookings for the Christmas and New Year season were expected to drive export growth.
April-August 2023 Overview: Contractions and Shifting Dynamics
- In the broader context, from April to August 2023, exports contracted by 11.9% to $172.95 billion, while imports experienced a 12% decline, totaling $271.83 billion.
- However, the trade deficit in this five-month period narrowed to $98.88 billion, compared to $112.85 billion in the same period the previous fiscal year.
- Non-petroleum exports during April-August 2023 were 7.3% lower, amounting to $141.29 billion, compared to the corresponding period in the previous year.