Exports dip for sixth straight month in May
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New Delhi: India’s exports dipped for the straight sixth month, contracting by 20.19 per cent in May to $22.34 billion due to dip in crude oil prices. Imports also declined by 16.52 per cent for the month to $32.75 billion. It was steepest decline since February 2014 when imports contracted by 17.09 per cent. The trade deficit narrowed to a three month low of $10.4 billion.
However, gold imports grew 10.47 per cent to $2.42 billion in May on declining prices and easing of restrictions by RBI. The main exporting sectors including petroleum products, gems and jewellery, engineering and chemicals reported a negative growth in May.
“The decline in exports in May was broad-based. Services exports too have started feeling the brunt of weak demand. India’s services exports fell by 4.5 per cent to $13.1 billion in May. With this, services exports have declined for the second consecutive month,” said rating agency Crisil.
Reacting to the sharp decline, Federation of Indian Export Organisations (FIEO), president S.C. Ralhan said that the continuous negative double growth in exports since December 2014, is a matter of serious and grave concern. “This, if allowed to continue will severely impact the Indian economy. FIEO has been continuously raising this serious concern with the government,” said Mr Ralhan.
FIEO chief stated that the prime reason continues to be low prices of crude, metal and commodity. “Petroleum exports further declined sharply by 59.10 per cent which itself is responsible for an overall decline of about 12 per cent, as the sector used to contribute to 20 per cent of country’s exports,” he said.
“At present, we expect Indian merchandise exports to display a low growth of two per cent in 2015-16, following the contraction recorded in 2014-15,” said Aditi Nayar, senior economist, ICRA.
( Source : deccan chronicle )
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