Recovery in EU pushes February exports up 4.25%
2013-03-14 12:01:45
India's exports rose for the second consecutive month in February, giving some succor for the government on the current account deficit front as well as fuelling hopes that this could be the beginning of a new growth phase.
Exports from the country grew 4.25% in February, mainly because of a recovery in exports to the European Union and in sectors such as engineering and refined oil.
Merchandise exports stood at $26.26 billion dollars (about 1.43 lakh crore), compared with $25.19 billion in the comparable year-ago period. After eight months of contraction, exports had turned positive in January, growing 0.82%.
"December fall was low, then January turned slightly positive and February has improved further, so it looks like a trajectory," said commerce secretary SR Rao.
Rao said Europe is performing better now. "The decline has been arrested, whereas US continues at the same level." Other sectors that performed well included rice, oil meals, pharmaceuticals and chemicals.
The commerce secretary said the ministry is in talks with all stakeholders for formulating the foreign trade policy that is to be announced later this month.
However, exports during the April-February period fell 4% to $265.95 billion. This year's exports are likely to fall short of the $303 billion mark achieved last fiscal and way below the target of $360 billon.
M Rafeeque Ahmed, president of Fieo (Federation of Indian Export Organisations) said India needs to revisit its export strategy to increase competitiveness and at the same time aggressively market its products and services. In the April-February period, rice exports rose 27.7% on a year-on-year basis and engineering exports declined 3% to $51 billion.
A commerce ministry official said there was one less day this February, compared with last year. "This shows that the growth is likely to continue," the official said, requesting anonymity.
Imports, on the other hand, grew 2.6% to $41.18 billion in February, leaving a trade deficit of $14.92 billion, slightly below the $14.93 billion seen in February 2012. Last month, the trade deficit had widened to about $20 billion, the second-highest figure ever in a month.
A Sakthivel, chairman of Apparel Export Promotion Council, said the government needs to keep the momentum going by making credit available at lower interest rates.