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Exports up by 10 pc, current account on bop shows deficit
Mumbai, Nov 03: India`s exports during the first half of the current fiscal year grew 10 per cent in us dollar terms as compared with 18 per cent in the corresponding period last year even as the current account of the balance of payments (BOP) during April-June 2003 showed a deficit after remaining surplus consecutively for previous six quarters.
Mumbai, Nov 03: India's exports during the first half of the current fiscal year grew 10 per cent in us dollar terms as compared with 18 per cent in the corresponding period last year even as the current account of the balance of payments (BOP) during April-June 2003 showed a deficit after remaining surplus consecutively for previous six quarters.
During the same period, imports rose faster by 21.4 per cent as against an increase of 9.2 per cent in the corresponding period last year, according to the mid-term review of the monetary and credit policy released today.
Oil imports increased 6.3 per cent as compared to 12.6 per cent in the corresponding period of the previous year, it said adding that non-oil imports increased 28 per cent as against an increase of 7.8 per cent in the corresponding period last year.
As a result, the policy said, the overall trade deficit at USD 7.1 billion during April-September was higher than the deficit of USD 3.5 billion in the same period of last fiscal.
The higher trade deficit this year, in substantial part, reflected growth in import demand emanating from a pick-up in economic activity as reflected in higher capital goods imports, it said.
The current account showed a deficit during April-June period, it said, adding the trade deficit (on payment basis) of USD 5.9 billion was offset to a large extent by private transfers of USD 4.2 billion.
In addition, the RBI said there was significant increase of USD 6.4 billion in net capital inflows comprising mainly foreign investment (USD 2.8 billion), NRI deposits (USD 1.7 billion) and external loans (USD 1.2 billion).
As a result, the net accretion to foreign exchange reserves, including valuation change, amounted to USD 6.7 billion during the first quarter of 2003-04.
"While for well known reasons it is difficult to anticipate the behaviour of capital flows, the positive sentiment on India should augur well for continued buoyancy; but some moderation should not be ruled out if the stance of monetary policies in leading industrial economies are to transit from soft or neutral to a relatively tighter regime," the central bank said. Bureau Report
Oil imports increased 6.3 per cent as compared to 12.6 per cent in the corresponding period of the previous year, it said adding that non-oil imports increased 28 per cent as against an increase of 7.8 per cent in the corresponding period last year.
As a result, the policy said, the overall trade deficit at USD 7.1 billion during April-September was higher than the deficit of USD 3.5 billion in the same period of last fiscal.
The higher trade deficit this year, in substantial part, reflected growth in import demand emanating from a pick-up in economic activity as reflected in higher capital goods imports, it said.
The current account showed a deficit during April-June period, it said, adding the trade deficit (on payment basis) of USD 5.9 billion was offset to a large extent by private transfers of USD 4.2 billion.
In addition, the RBI said there was significant increase of USD 6.4 billion in net capital inflows comprising mainly foreign investment (USD 2.8 billion), NRI deposits (USD 1.7 billion) and external loans (USD 1.2 billion).
As a result, the net accretion to foreign exchange reserves, including valuation change, amounted to USD 6.7 billion during the first quarter of 2003-04.
"While for well known reasons it is difficult to anticipate the behaviour of capital flows, the positive sentiment on India should augur well for continued buoyancy; but some moderation should not be ruled out if the stance of monetary policies in leading industrial economies are to transit from soft or neutral to a relatively tighter regime," the central bank said. Bureau Report