NEW DELHI: Exports registered 25.67 per cent growth in dollar terms and 21.35 per cent in rupee terms in September 2017 over the previous year, fuelled by high growth performance of engineering goods, gems & jewellery, petroleum products, organic and inorganic chemicals, textiles, drugs and pharmaceuticals.
Import also expanded 18.09 per cent at $37.6 billion in September against $31.83 billion in the same period last year, according to data released by the commerce ministry on Friday. Trade balance remained flat at $8.98 billion in September against $9 billion in September 2016. With the expansion of merchandise exports surpassing that of imports by a wide margin, the trade deficit narrowed to single digits in September 2017 after seven months.
“The continued improvement in the pace of growth of merchandise exports, as well as its fairly broad-based nature, suggest that concerns that arose after the transition to GST, may be receding in some sectors,” said Aditi Nayar, principal economist at ICRA Limited, a credit rating agency. Other products that pushed growth include cotton yarn/fabs/made-ups, handloom products, marine products and electronic goods.
“However, some of the major labour-intensive sectors like handicraft, fruits & vegetables, meat, dairy & poultry products and iron-ore have posted negative growth. The decline in these highly employment-intensive sectors is a worrisome sign,” said Ganesh Kumar Gupta, president, FIEO. But, based on the persistently high growth of merchandise imports, ICRA expects the current account deficit to more than double to $7.5-8.5 billion in the second quarter of FY18 from $3 billion in the Q2 of FY17.
Nevertheless, the size of the current account deficit would soften appreciably on a sequential basis from the $14 billion recorded in Q1 FY18, the research agency said. Major commodity groups that showed high import growth in September 2017 over the corresponding year-ago period are petroleum, crude & products (18.47 per cent); electronic goods (40.9 per cent); pearls, precious & semi-precious stones (56.91 per cent); machinery electrical & non-electrical (16.36 per cent); and coal, coke & briquettes (48 per cent).
Exports continued its robust performance in the past 13 months and during September 2017, exports were valued at $28,613.41 million against $22,768.35 million during the same period last year. In rupee terms, it was `1,84,387.36 crore against `1,51,950.74 crore during September 2016, according to the statement.
Non-petroleum and non-gems & jewellery exports in September 2017 were valued at $20,237.82 million against $15,731.26 million in September 2016 —an increase of 28.65 per cent.
Trade deficit narrows
With expansion of merchandise exports over imports by a wide margin, trade deficit narrowed to single digit in September 2017 after seven months