Fall in India's exports slows down to 6.6 % in October

India seems to have arrested the steep fall in its exports, with the decline slowing down to 6.6 per cent to $ 13.19 billion in October this year from $ 14.13 in the same month of last year.

Commerce and Industry Minister Anand Sharma told a press conference here today that this was a significant sign of stabilisation and improvement in Indian exports compared to the fall of close to 39 per cent in May this year.

This was the 13th straight month in which the country's exports had registered a fall, mainly due to the lower demand from developed countries as a result of the global economic downturn. But the extent of fall has been gradually reducing.

Exports had fallen by 27.7 per cent in June, 28.4 per cent in July, 19.4 per cent in August and 13.8 per cent in September this year.

Mr Sharma said the stabilisation in exports needed to be viewed in the context of projects by the International Monetary Fund (IMF) of an 11.9 per cent decline in world trade volume during 2009 coupled with a 36.6 per cent decline in commodity prices of oil and 20.3 per cent decline in non-fuel commodity prices during 2009, he said.

Mr Sharma said segments such as man-made yarn/fabric/made-ups (1.2 %), tobacco (20.5 %) and fruits and vegetables (5.7 %) were the sectors which did well in April-October this year, with no effect of the global slowdown on them.

Sectors which have shown a turnaround in exports in October after being significantly impacted by the slowdown in earlier months are plastic and linoleum, drugs and pharmaceuticals, marine products, iron ore, spices, oil meal, cashew and petroleum products.

Some export commodities which were significantly impacted by global slowdown have shown lower rate of decline in October, 2009 as compared to earlier months: cotton yarn/ fabrics / made ups, handicrafts, basic chemicals (other than pharmaceuticals), gems and jewellery, leather and leather manufactures, engineering goods, electronic goods and tea.

The sectors which continue to show significant decline in exports include jute manufacturing, including floor covering, carpets, and coal and other ores, including processed minerals.

Software exports have not shown any decline during April-October, 2009.

Mr Sharma said that the overall reduction in the rate of decline of export growth in the seven months of the current financial year indicated that the different support measures announced by the Government in the Budget and the Foreign Trade Policy had helped to arrest the rate of the fall, particularly, for labour intensive sectors.

The minister said that, despite the slowdown, foreign direct investment (FDI) inflows during April-October this eyar were $ 15.3 billion, comparable to $ 17.2 billion received during the corresponding period of the last fiscal year.

According to him, the total FDI into India since the economic liberalisation process was launched (from August, 1991 to September, 2009) was nearly $ 121.85 billion.

NNN