NEW DELHI: India's exports grew by 5.27 per cent year-on-year in September to USD 27.4 billion, mainly on the back of a jump in iron ore trade, farm products and pharmaceuticals as post-Covid demand from many countries perked up.
Imports on the other hand dipped by 19.6 per cent to USD 30.31 billion, according to commerce ministry data released on Friday. The contraction in imports, seen by analysts as a sign of a weaker recovery by Indian industry and lower oil prices, narrowed the trade deficit to USD2.91 billion against USD11.67 billion in September 2019.
The rise in exports happened after sales abroad shrank for six months in a row. Iron ore exports, much of it going to China, more than doubled recording a growth of 109.52 per cent. "The Chinese have got over the Covid hump and are spending on infrastructure projects which is why they are importing raw materials like iron ore," said Prof Biswajit Dhar of the JNU and a member of the Board of Trade.
Exports to China have gone up despite India taking a number of steps to reduce its import dependence on its northern neighbour, with whose troops Indian soldiers clashed over a disputed border recently.
Among other products showing a jump were rice, whose sales abroad shot up by 92.44 per cent, oil meals (43.9 per cent), carpets (42.89 per cent), pharmaceuticals (24.36 per cent), Meat, dairy and poultry products (19.96 per cent) and Cotton yarn/fabrics/madeups, handloom products (14.82 per cent).
"We have made a good recovery, but it’s mostly in raw materials," pointed out Sharad Kumar Saraf, President of Federation of Indian Export Organisations (FIEO). "We have huge stocks of farm produce and need to sell them to make space for our Kharif crop, hence the added impetus to sell," Dhar added.
The Indian Pharma sector was also obviously a Covid beneficiary as countries stocked up on drugs for their health care sectors.