July exports further consolidates as continuous arrest in decline of exports led to lower double-digit negative growth

Ludhiana: Reacting to July exports, FIEO President Mr Sharad Kumar Saraf said that monthly figures have further consolidated as continuous arrest in the decline of exports have led to a lower double-digit negative growth of just 10.21 percent with USD 23.64 billion as against very high negative double-digit growth during April and May this fiscal. Mr Sharad Kumar Saraf said that all this has been possible because of the start of business activities across the country and business/order enquiries from almost all major economies like US, EU, Canada, Japan, South Korea, Australia and New Zealand which has helped in bringing the exports sector to almost 90% of the level in July 2019.

Though the monthly exports data depicts a lower double-digit decline in exports, but it must be seen in the context of the recovery that has exceeded our expectation as the government through constant interaction with exporters has been understanding and more importantly addressing the exporters’ problems, added FIEO Chief. Mr Saraf however feels that the global revival and business sentiments still have not picked up, impacting the global supply chain. He is of the view that the focus should be on FTAs and more of multi-lateral agreements to further revive our exports and take up competition coming from smaller countries like Vietnam, Bangladesh and Taiwan.

16 out of the 30 major product groups were in positive territory during July 2020 and imports during the month showed a high double-digit decline of 28.40 percent with USD 28.47 billion. Mr Saraf added that the exports during the month for emergency and essential items apart from some labour-intensive sectors including drugs & pharmaceutical, engineering goods, cotton yarn/fabs/made-ups etc, jute manufacturing including floor covering, carpet, plastics & linoleum along with agri, plantation and meat & dairy products besides iron-ore were in positive territory showing signs of further revival with few showing impressive double-digit growth. President, FIEO expressed his satisfaction over the improvement in labour-intensive sectors of exports, which directly or indirectly impacts employment generation in the country. FIEO President reiterated that there is a need to analyse imports as well, as such a steep decline in imports may hamper the industrial recovery in coming months.

FIEO Chief said that as the global trade forecast still shows a gloomy picture, there is an urgent and immediate need for a special exports package for reviving India’s foreign trade. Besides creation of an Export Development Fund with 1% percent corpus of the total value of exports during the last fiscal, MEIS of 2% across the board and 4% for labour-intensive sectors and addressing "risky exporters" issues apart from quickly deciding on RoDTEP rates are some of key concerns, which should be immediately considered to give a much-needed boost to the exports sector and the overall economy.