India Exim Bank expects the country’s merchandise exports to decline 4.8% year-on-year to $105.4 billion during July-September amid weak demand from the West.
“India’s exports could be shadowed by continued slowdown in select major trade partners including advanced economies, continued global geopolitical uncertainty as a result of increasing geo-economic fragmentation and high inflationary pressures leading to tighter global monetary and financial conditions,” the Bank said.
India’s exports for the first half of FY24 are expected to amount to $208 billion, while non-oil exports could amount to $172 billion during the same period.
The country’s merchandise trade gap swelled to the highest in 10 months in August as exports continued to slow down. Data showed that exports slipped nearly 7% to $34.48 billion in August from $37.02 billion a year earlier. Imports declined to $58.64 billion from $61.88 billion last year, leaving the trade balance at $24.16 billion.
Engineering goods exports, however, recovered in August, rising 8% after eight consecutive months of year-on-year decline.
Export of electronic goods rose by 26.29% in August to $2.17 billion. During the April-August period, overseas sales rose 35.22% to $11.18 billion.
Gold imports in August rose 38.75% to $4.93 billion, and by 10.48% to $18.13 billion during April-August.
Exporters said that a sluggish global economy and falling demand especially in major countries have led to the modest export performance in recent months.
Manufacturing across the Eurozone and the US has also contracted due to persistent policy tightening measures by both the US Federal Reserve and the European Central Bank squeezing finances, they added.