India’s merchandise exports are expected to grow 6.3% year-on-year to $111.2 billion during in the third quarter of FY24 (October-December 2023) due to an expected increase in global demand, Export-Import Bank of India (India Exim Bank) said on Thursday. Non-oil exports during the third quarter of the current fiscal are seen rising 7.7% on-year to $ 88.1 billion. However, these numbers should be seen against the backdrop of negative growth during the first two quarters, the bank added.
“Positive growth in India’s exports could be a result of an improvement in India’s GDP growth outlook and the expected easing of monetary policy globally,” it said. “The outlook is, however, subject to the risk of uncertain prospects for advanced economies, geopolitical shocks, and deepening geo-economic fragmentation, among other factors,” it added.
Global trade has slowed down as monetary policy tightening, fading fiscal support, persistent inflation and geopolitical tensions are weighing on demand. India’s merchandise-export growth turned positive for the first time in the current financial year with a 3.86% on-year rise to $38.45 billion in August.
According to official data released last month, Indian merchandise exports dipped by 2.6% year-on-year to $34.47 billion in September, while imports fell by 15% to $53.84 billion – the 10th consecutive monthly decline. This caused the merchandise trade deficit to narrow to $19.37 billion in September, its lowest level in five months.
India’s total merchandise exports for the first nine months of FY2024 (April-December 2023) are expected to total $323 billion, while non-oil exports could total $258 billion over the same period, India Exim Bank said.
“India’s total merchandise exports have consistently remained above $100 billion for nine consecutive quarters since Q2 FY22, reflecting resilience amid a challenging global economic situation,” the bank said. “Positive growth in exports is expected to continue in the last quarter of the financial year,” it added.