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Exports rise in Jan despite Red Sea crisis; trade gap shrinks to 9-month low

Source: PTI
February 15, 2024 23:56 IST
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India's exports rose to a three-month high of 3.12 per cent to $36.92 billion in January despite global uncertainties including the Red Sea crisis, while the trade deficit narrowed to a nine-month low of $17.49 billion, the government data released on Thursday showed.


Photograph: ANI Photo

After recording negative growth for two months in a row, imports grew by about 3 per cent to $54.41 billion in January.

The previous low in trade deficit  -- the difference between imports and exports -- was recorded in April 2023 at $15.24 billion. In January 2023, it was $17.03 billion.

Crude oil imports rose by 4.33 per cent to about $16.56 billion during the month under review.


Gold imports jumped by about 174 per cent in January to $1.9 billion.

Cumulatively, exports during April-January this fiscal dipped by 4.89 per cent to $353.92 billion.

Imports contracted by 6.71 per cent to $561.12 billion, leaving a trade deficit of $207.2 billion in the ten-month period of this fiscal as against $229.37 billion in April-January 2022-23.

Crude oil imports declined by about 15.91 per cent to $146.75 billion in April-January 2023-24 while gold imports surged 301.7 per cent to about $38 billion.

Briefing reporters on the data, commerce secretary Sunil Barthwal said that despite the Red Sea crisis, recession in economies of advanced countries, and falling commodity prices, India has recorded "positive growth in merchandise exports in January".

Barthwal said that he has held three meetings with exporters, concerned ministries and stake holders on the Red Sea crisis.

The objective was to help the exporters navigate the difficult situation created in the Red Sea.

"We also try to tell banks that whatever maximum credit can be given during this period to our exporters that should be extended.

"Exim bank and ECGC was told not to increase insurance premium rates.

"This overall positive atmosphere which we create...has helped in (promoting) the export growth," he told reporters.

"I assure you that we will be continuing our efforts by working with them, so that in the coming year also we are able to see a positive growth in our exports," he said.

"The commerce ministry has also set up a task force on non-tariff barriers to help exporters get greater market access.

"The task force will continue to work and "I am sure that it will help to push exports," Barthwal said, adding the ministry is also focusing on new products and new territories.

"We are happy to say there are huge number of products we have been able to push for the first time.

"We are trying to create much larger basket for ourselves in terms of our exports," he added.

The Red Sea crisis is impacting exporters as it has pushed the transportation cost as they are taking a longer route -- via Cape of God Hope, encircling Africa -- to ship their goods to Europe and certain parts of Africa.

The situation around the Bab-el-Mandeb Strait, a crucial shipping route connecting the Red Sea and the Mediterranean Sea to the Indian Ocean, has escalated due to attacks by Yemen-based Houthi militants.

Due to these attacks, the shippers are taking consignments through the Cape of Good Hope, resulting in delays of almost 14 days and also higher freight and insurance costs.

State-owned ECGC is an export promotion organisation, seeking to improve the competitiveness of Indian exports by providing them with credit insurance covers.

During January, 18 of the 30 key sectors exhibited positive growth including iron ore, spices, oil meals, oil seeds, carpet, electronic goods, tea, pharmaceuticals, petroleum products, coffee, engineering goods and chemicals.

According to the data, the estimated value of services export rose to $32.8 billion last month, as compared to $28 billion in January 2023.

During the ten-month period, services exports increased to $284.45 billion as compared to $267.5 billion in April-January 2023.

The ministry also informed that India's share in global exports has increased to 10.35 per cent ($261.09 billion) in 2022 from 8 per cent ($194.96 billion) in 2014.

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