Union Minister of Commerce, Industry and Textiles Anand Sharma on Friday said that the country’s exports may not even reach last year’s numbers of $306 billion.
Chairing the Board of Trade (BoT) meeting here, Sharma said, “What is very disturbing and challenging both is that we have not even reaching where we were a year before that is $360 billion.”
What is more worrying is the surging current account deficit (CAD) or trade deficit, which is likely to widen further between $193 billion and $196 billion.
The minister said that the trade deficit was $182 billion in the first 11 months of 2012-’13 and will “definitely be somewhere between $193 billion and $196 billion in the current fiscal”.
“This is not a small number and that is where the crisis is. Therefore every institution must ensure faster movement,” he added.
Exports dropped by 4 per cent to $265.95 billion in the April-February period this fiscal while imports during the 11-month period grew by only 0.25 per cent to $448 billion, showing a trade deficit of $182.1 billion.
The high-level Board of Trade meeting had representatives from various ministries such as external affairs, finance and micro and small and medium enterprises (MSMEs). The meeting was also attended by exporters and industry associations.
The BoT is a precursor to the final Foreign Trade Policy (FTP) that is scheduled to be announced next month. The BoT has been recommending various steps for the annual supplement of the FTP, 2009-’14.
“Given the high level of imports and lesser exports, the trade deficit will become challenging because it directly affects current account deficit, which in turn will put pressure on rupee,” Sharma said.
Talking about the weak global demand, Sharma said: “Now it is much more difficult to make that kind of interventions or to work out (that kind of) stimulus packages. Given that growth has not taken place or there has been a downturn, the resource availability has also constrained.”