New Delhi: Exports declined 3.15 percent in March, limiting the growth rate for 2013-14 to about 4 percent and falling short of the annual target by about USD 13 billion even as the trade deficit improved on shrinking gold imports.
According to exporters, outbound shipments were affected by both domestic and global factors.
"Manufacturing is declining. About Rs 20,000 crore is held up with the revenue department as they are not clearing our refunds. It has impacted exports adversely. Global demand situation is also not very healthy," Federation of Indian Export Organisations (FIEO) President Rafeeq Ahmed said.
He expressed hope that exports would improve in the coming months.
India's exports grew 3.98 percent to USD 312.35 billion in 2013-14, while imports dipped 8.11 percent to USD 450.94 billion, narrowing the trade deficit to USD 138.59 billion, according to data from the Ministry of Commerce and Industry.
A drop in gold and silver imports helped to shrink the trade gap. Overseas purchases of the precious metals dropped 40 percent to USD 33.46 billion.
The trade deficit in 2012-13 stood at USD 190.33 billion.
In March, exports contracted 3.15 percent to USD 29.57 billion and imports fell 2.11 percent to USD 40 billion from a year earlier. The trade deficit last month was at USD 10.5 billion compared with USD 10.4 billion in March 2013.
The country's merchandise exports in 2013-14 fell short of the target of USD 325 billion set by the government and were higher than USD 300.4 billion in 2012-13.
Oil imports in March increased 17.7 percent to USD 15.78 billion. In 2013-14, oil imports grew 2.2 percent to USD 167.62 billion.
Sectors that contribute significantly to the country's exports recorded lower growth in 2013-14.
Gems and jewellery exports declined 8.82 percent to USD 39.52 billion. Petroleum exports, which account for about 20 percent of India's outward shipments, dipped 0.01 percent to USD 60.85 billion in 2013-14.
Exports of electronic goods fell 5.87 percent to USD 7.58 billion.
However, pharma and engineering exports registered growth of 1.2 percent and 8.49 percent, respectively, to USD 14.84 billion and USD 61.61 billion.
Ready-made garment shipments registered a growth of 15.58 percent to USD 14.94 billion.
To boost exports, Ahmed said the government should focus on areas such as services, e-commerce, hi-tech products and branded goods.
"Slowdown in manufacturing, liquidity crunch, currency appreciation, coupled with depreciating currency of few of our trading partners, softening of metal and commodity prices and uncertainty in few regions of the world are the prime reasons for the slowdown," he added.
He said that India's exports to Latin America suffered a major setback with shipments to the region dropping 20 percent in 2013-14. Exports to North Africa also witnessed a declining trend.
First Published: Friday, April 11, 2014, 19:04