New Delhi:

India registered record exports in the just concluded financial year 2023-24 at USD 778 billion, sources in the commerce ministry said. In 2022-23, the country exported goods and services combined at USD 776.3 billion.

In break up, services exports rose from USD 325.3 billion to USD 341.1 billion in 2023-24. Merchandise exports though marginally declined from USD 451.1 billion to USD 437.1 billion.

Among various steps the government took was to launch a Production Linked Incentive (PLI) scheme in varied sectors, including electronic goods, to make Indian manufacturers globally competitive, attract investments, enhance exports, integrate India into the global supply chain and reduce dependency on imports. These seemed to have reaped dividends.

China, Russia, Iraq, UAE, and Singapore are among the countries where India’s exports in the just-concluded financial year have risen substantially, though with a low base. The other countries in the Top 10 list are the UK, Australia, Saudi Arabia, the Netherlands, and South Africa.

Coming to overall imports, they declined from USD 898.0 billion in 2022-23 to USD 853.8 billion. Both merchandise and services exports declined during the financial year.

Overall trade deficit significantly improved from USD 121.6 billion in 2022-23 to USD 75.6 billion in 2023-24.

In the first month of 2024-25 – April, India exports, including merchandise and services, rose from USD 60.40 billion to USD 64.56 billion. Imports however rose from USD 63.02 billion to USD 71.07 billion.

The trade deficit during April rose from USD 2.62 billion to USD 6.51 billion on a yearly basis.

During April, exports of electronic goods, organic and inorganic chemicals, petroleum products, and drugs and pharmaceuticals were higher on a yearly basis. On the contrary, exports of engineering goods, iron ore, gems and jewellery, marine products, and oil meals declined.

On the import side, petroleum crude and products, gold, electronic goods, pulses, and vegetable oil, rose while pearls precious metals and precious stones, iron and steel, among others, declined.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

Photo used for illustration purpose only.
| Photo Credit: K.R. Deepak

With merchandise exports shrinking 15.1% in the first quarter of this year, after racking up a record $450 billion in 2022-23, the government is playing it safe on announcing a clear target for outbound shipments this year and is likely to opt for a range of scenario-based targets instead.

While the Commerce Ministry has undertaken an internal exercise to set a target for exports in 2023-24 — and has even communicated a number to export promotion councils of different industrial sectors as well as overseas diplomatic missions — there is now a rethink underway, a senior Ministry official indicated.

Shrinking exports

Goods exports had decelerated 12.6% in April and 10.2% in May, but recorded their steepest fall in 37 months this June with a 22% drop. The $32.7 billion export tally for last month was also the lowest in absolute terms since October 2022.

While the final June numbers for exported services are still awaited, forex earnings from these intangible exports have also slowed sharply after growing about 28% to $325 billion in 2022-23. As per estimates, services exports have grown just 5.2% to $80 billion, while goods exports stand at a little over $102 billion through the first quarter.

Different scenarios, different goals

“Our broader target for exports, as per the new Foreign Trade Policy, is to achieve $2 trillion by 2030, with services and goods exports accounting for a trillion dollars each. But the way things are shaping up so far, in line with the World Trade Organisation’s forecast of slower global trade growth in 2023, it is perhaps not right for us to set a singular target,” the official explained.

“We are waiting and watching. The first quarter numbers have given us some indication and we hope overseas orders start picking up. However, instead of a single target, an exercise is being done to formulate a range of possible export goals, based on scenarios such as the most optimistic scenario, a ‘business-as usual’ situation, and if there’s a persistently declining trend. So we need to wait for some more time,” the official emphasised.

On petroleum exports, which have seen the sharpest plunge of 33.2% in the first quarter, another official said that this was largely driven by the reduction in global oil prices. However, there is also some moderation in demand due to the price cap sanctions imposed on Russian oil shipments. Last year, petroleum exports had boomed as Indian firms processed and re-exported large volumes of Russian oil, he said.