After a positive growth in September, Indian export was seen to go down during October. Due to issues like a dip in shipments of petroleum products, gems and jewelry, leather, and engineering goods the Indian export was estimated to plunge by 5.4 percent to $24.82 billion in October.
According to reports imports also fell during the month of October. Imports fell by 11.56 percent to $33.6 billion during this month. As a result trade deficit fell to $8.78 billion as against $11.76 billion.
Commerce and Industry Ministry said in a statement, “India’s merchandise exports in October 2020 were $24.82 billion, as compared to $26.23 billion in October 2019, showing a fall of 5.4 percent.”
Major export commodities took a hit during this time. The export of petroleum products went down by 53.30 percent. The export of cashew dropped by 21.57 percent. Gems and jewelry export dropped by 21.27 percent. Leather export and man-made yarn/fabrics/made-ups export went down by 16.69 percent and 12.82 percent respectively. The export of electronic goods, marine products, and engineering goods also plunged by 9.40 percent, 8.09 percent, and 3.84 percent. The export of coffee also reportedly went down by an estimated 9.25 percent this month.
On the other hand, some sectors saw positive growth during this time. Some of these sectors which saw positive growth include rice, oil meals, iron ore, oilseeds, carpet, pharmaceuticals, spices, cotton, and chemicals. In the period of April to November 2020, exports declined 19.05 percent to $ 150.07 billion. In the same period imports fell by 36.28 percent.
Oil imports fell by 38.52 percent to $ 5.98 billion in October. During the same April to October period, oil imports fell by 49.5 percent to $ 37.84 billion. Due to the COVID-19 pandemic and the lockdowns, exports had contracted for straight six months. In September it went up by 5.99 percent to $ 27.58 billion.
Sharad Kumar Saraf, president of Federation of Indian Export Organisations (FIEO) said, according to a Moneycontrol.com report that the nominal decline in exports during the month was mainly because of huge container shortage and hike in sea freight, which upset exports, particularly for those who have negotiated on CIF (Cost, Insurance, Freight) or C&F (Cost and Freight) basis. Besides, farmers’ agitation in some of the hinterland states also affected exports during October.
He added, “as the election process gets over in the US, with the upcoming Christmas and New Year season, both global and Indian economy is slated for economic revival. Exporters have continuously been receiving a lot of inquiries and orders, further adding to the positive sentiments with signals of further resilience in the global supply chain.”
The same report from moneycontrol.com also cited Mohit Singla, founder chairman, Trade Promotion Council of India (TPCI), who said, “The time has come for India to be the global food basket of the world, as India has witnessed two bumper crop harvest and Indian industry is already capitalizing the advantage fully despite tough times.”
He also said that agri-food and products saw positive growth. This positive growth, according to him shows the demand for Indian food and Agri products globally, despite other traditional products slipping in demand.