Team Blitz India
INDIA’S merchandise exports surged 11.9 per cent in February to $41.4 billion, displaying strong momentum amid the ongoing Red Sea crisis and uneven economic growth outcomes among trade partners. This has been the fastest growth since June 2022 after a growth of 3.1 per cent in January. With this, the exports grew for the third consecutive month, indicating sustained momentum.
The near-term challenge to India’s exports due to the Red Sea crisis has been limited so far, however, the key monitorable going forward will be how the crisis will impact prices when export contracts are renewed, said Crisil. Barring this hiccup, Crisil stated, the recent healthy export momentum and forecasts by major multilateral organisations of better trade growth this year over last year are encouraging. On a seasonally adjusted basis, exports grew 5.4 per cent on-month after declining 2.6 per cent in January.
Many core export items such as pharmaceuticals, engineering goods, organic and inorganic chemicals and readymade garments recorded a surge in February, said Crisil. Chemical exports picked up pace swiftly, growing 33 per cent on-year after recording mild growth of 0.3 per cent on-year in January and remaining in negative territory for the previous 15 consecutive months. On the whole, core (non-oil, non-gold) exports grew 17.2 per cent on-year in February compared with 2.5 per cent in January, registering the highest growth since April 2022. Exports of gems and jewellery, however, remained in negative territory for the second consecutive month.
Cumulatively, India’s merchandise exports fell 3.45 per cent on-year to $394.99 billion in the April-February period this fiscal compared with $409.11 billion a year ago. Merchandise imports grew faster than exports in February, surging 12.2 per cent onyear to $60.1 billion compared with 1 per cent the previous month.
Core imports grew 5.2 per cent onyear after declining 1.1 per cent onyear on average in the November 2023 to January 2024 period due to a sharp surge in gems & jewellery imports (94.4 per cent on-year) primarily led to a higher merchandise import bill in February.
The merchandise trade deficit widened to $18.71 billion in February from $16.57 billion a year ago and $16.46 billion the previous month.
