Millennium Post
Business

May exports shrink 4.16%

Adding woes to sluggish economy, India's exports declined by 4.16 per cent to $25.68 billion in May due to unabated slump in global demand and slowdown in domestic industrial growth.

Imports dropped by a sharper pace of 7.36 per cent to $41.9 billion, signalling weakening of the economy especially with regard to fresh investments as inward shipments of plant and machinery fell by eight per cent, according to provisional data released on Thursday.

The trade deficit also narrowed to $16.3 billion during May from $18.5 billion a year ago.

‘We have also seen the IIP [index of industrial production] numbers. So you can correlate the reasons why exports have not done too well...,’ commerce secretary S R Rao said.

In the backdrop of an ambitious 20 per cent growth target in exports for the current fiscal, announced in the recently released foreign trade policy, the commerce ministry is ‘recalibrating its strategy’ to find out a solution, he said.

Dismal export performance comes on the heels of disappointing industrial output that showed a mere 0.1 per cent expansion in April.

Contraction of demand in India's traditional markets, particularly in eurozone economies is hurting exports, Rao said, adding that ‘[We are] still not out of the woods... bailing out of Greece and Spain is still work in progress’.
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