Exports rise 5.27% in September, trade deficit narrows to $2.91 bn

NEW DELHI: India’s exports grew after a gap of six month in September driven by growth in outbound shipment of cereals, carpets, rice, oilmeals and iron ore. Exports rose 5.27% on year to $27.4 billion in September while imports declined 19.6%, leaving a trade deficit of $2.91 billion, preliminary data released by the commerce and industry ministry showed. Trade deficit narrowed from $11.67 billion in September 2019.

Exports in September 2019 were $26.02 billion. Gold imports shrank 52.85% last month.

“India is thus a net importer in September 2020…showing a substantial improvement of 75.06%,” the ministry said in a statement.

Non-oil, non-gold imports- an indicator of the strength of domestic demand- declined 13.29% on-year last month.

“The y-o-y growth in merchandise exports in September 2020 is heartening, after the faltering trend seen in the previous month. Regardless, the sharp gap in non-oil non gold merchandise imports remains a cause for concern regarding the strength of domestic demand,” said Aditi Nayar, principal economist at ICRA.

Exports in the April-September period fell 21.43% to $125.06 billion while imports declined 40.06% at $148.69 billion.

As per the data, only eight out of 31 major sectors of export declined last month.

Commodities that registered positive growth in exports in September include iron ore (109.52%), rice (92.44 %), oil meals (43.9 %), carpet (42.89 %) and pharmaceuticals (24.36 %).

Drugs and pharmaceuticals, rice and engineering goods witnessed the highest increase in export growth while gems and jewellery, man-made yarn/fabric/made ups and marine products saw sharp declines in outbound shipments.

The ministry said that in September, oil imports fell 35.92% to $5.82 billion while non-oil imports declined 14.41% to $24.48 billion.

Major commodity groups of import showing a decline in growth in September were silver (-93.92%), cotton raw and waste (-82.02%), newsprint, (-62.44%), gold (-52.85%) and transport equipment (47.08%).

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