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Marginal drop in exports in October

Special Correspondent

Sharma leaves for Geneva to attend WTO meeting
IMF projects 12 % drop in world trade volume in 2009

NEW DELHI: Stating that the worst was behind us, Union Commerce and Industry Minister Anand Sharma on Friday said that the decline in India’s exports, which saw the steepest fall of 39.2 per cent in May this year at the height of the global financial crisis, had been halted and stood at 6.6 per cent in October, the first time it has entered the single digit territory.

Mr. Sharma also said that with the review of various stimulus packages going on, the Government was expected to come out in support of labour-intensive sectors in December which continue to be on the decline. “The good news is that exports decline is in the single digit territory for October. We have succeeded through policy interventions and incentives to arrest the steep decline. The government will intervene, if required,” Mr. Sharma told journalists at a press conference before his departure for Geneva to attend the WTO Ministerial Meeting beginning November 30.

After dropping by 39.2 per cent in May this fiscal, exports fell at a much slower pace during the last five months, suggesting recovery in demand in major markets. The decline in exports in the month under review was only 6.6 per cent at $13.19 billion as compared to $14.13 billion in the year-ago period. The stabilisation in exports, he said needed to be viewed in the context of projections of International Monetary Fund (IMF) of 11.9 per cent decline in world trade volume during 2009 coupled with 36.6 per cent decline in commodity prices of oil and 20.3 per cent decline in non-fuel commodity prices during the year. “Hopefully, we will enter the neutral growth phase by December-end and exports would take a positive turn by the final quarter ending March 31, 2010. “We will be completing the sectoral analysis in the next few weeks and the segments, which still require more help would be given the same,” he said without elaborating any further.

The Commerce Minister said exports of gems and jewellery, petroleum products, drugs and pharmaceuticals, chemicals, iron ore, cotton yarn and fabrics, leather and marine products have shown positive growth. However, engineering and electronics exports remain areas of concern.

Mr. Sharma said that despite the current economic downturn, foreign direct investment (FDI) inflows during April-September 2009 were $15.3 billion, which is comparable to $17.2 billion received during the corresponding period of the previous year.

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