Merchandise exports fell by 6.58 percent to $32.91 billion in January. This is for the second month in a row that the sector has witnessed decline, with goods exports falling by 12.2 percent Y-o-Y in December, 2022 to $34.5 billion. No doubt, deepening global slowdown is playing spoilsport, but if we look at the figures for the overall fiscal as well as the performance of the goods and services export sectors together, the situation is not that discouraging.
During the April (2022)–January (2023) period, merchandise exports increased by 8.51 percent to $369.25 billion and it is expected that overall goods exports for the current fiscal may reach $440-450 billion. At a time when most of our competing countries are witnessing sharp decline in their exports, these figures seem healthy. Merchandise trade deficit is, however, a concern, with imports increasing 21.89 percent to $602.20 billion during the April-January period.
But our healthy services trade, which registered robust growth of 30 percent till December 2022, is helping us to balance the trade deficit. It is also remarkable that merchandise trade deficit itself is gradually shrinking and fell to a 12-month low of $17.75 billion in January. According to official data, services export in April-January 2022-23 may reach $272 billion as compared to $206.28 billion in the previous year, which is encouraging.
Meanwhile, the Union Commerce Minister last week said that India’s goods and services exports are estimated to reach $1 trillion each by 2030. The merchandise exports sector needs to grow at 8-9.5 percent while the services sector at 16-17 percent to reach that goal, which seems difficult but not impossible. Adequate support from the Centre must always be there, however, to reach the ambitious target.
I invite your opinions.