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| Edited By: Sreejiraj Eluvangal |Source: DNA |Updated: Mar 17, 2018, 05:04 AM IST
In what commerce secretary Rahul Khullar called a stimulus withdrawal symptom, India's exports dropped to just 13.2% in July, the lowest level in seven months. Total exports for the month of July was at $16.2 billion, the second lowest monthly export figure in six months, almost 20% below the record $19.9 billion market hit in March.
"Everywhere, governments are doing a calibrated withdrawal of stimulus.. The aggregate demand has taken a hit," Khullar, known for his cautious assessments, explained. He pointed out that countries everywhere are trying to emerge out of the recession by promoting their own export to fast-growing economies like India and China.
"There is a limit to how much the world can depend on growth in India and China," he pointed out, adding that consumption is these countries too may start declining if their own exports get hit.
Part of the reason for the dip has been previous year numbers. Exports were at their weakest levels from November 2008 to June 2009, when they tended to remain below the $13 billion mark. In July last year, exports started picking up, hitting $14.3 billion in August. July was also the month in which Indian exports set a pre-recession record of $19 billion dollars in 2008.
In keeping with the higher base from the second half of last year and global withdrawal of stimulus, growth numbers are likely to be around 15% for the second half of the year, compared to 35% for the first half of 2010, warned Khullar.
India, however, is likely to reach its target of growing its exports by 15% this year to hit $200 billion. The first four months have already seen total exports of around $69 billion.
However, the government is concerned about the relentless growth in imports and the resulting jump in the trade deficit or import-export gap. The difference between the foreign exchange bill of imports and exports is met by diverting earnings from the exports of services, such as IT and BPO.
