Exports to five of India’s top 10 markets shrink in March, shows govt data
A slowdown in the demand for Indian goods from five out of the country’s ten key markets–US, UAE, Bangladesh, Germany and Hong Kong–resulted in a sharp contraction of nearly 14 per cent in exports during March, data compiled by the commerce and industry ministry showed.
The 10 key importing nations account for 52 per cent of the value of goods India exported in March.
Exports to the US, which has been India’s largest market for a decade, dipped 5.4 per cent by value to $7.32 billion in March. The value of shipments to the UAE, the second largest market which also signed a free trade agreement with India last year dropped 12.6 per cent to $2.70 billion. Exports to Bangladesh, Germany and Hong Kong fell 28 per cent, 24.3 per cent and 28.4 per cent, respectively.
Of the top ten markets, countries to which Indian exports grew include the Netherlands (42.2 per cent), UK (17.5 per cent), Singapore (10.9 per cent), and Saudi Arabia (18.6 per cent).
According to data released by the commerce and industry ministry on Thursday, merchandise exports fell 13.9 per cent year on year to $38.38 billion in March, as global headwinds such as geopolitical tensions, high inflation, and monetary policy tightening continued to affect external demand. This was the sharpest contraction since May 2020.
On a cumulative basis, three of the top ten export partners–China, Bangladesh, Hong Kong–saw 27.9 per cent, 27.7 per cent and 9.9 per cent contraction, respectively in FY23.
During FY23, exports grew only six percent YoY to $447.46 billion, from a robust 44 per cent jump ($422 billion) in FY22.
The US and UAE remained India’s top two export destinations in FY23 as FY22. The Netherlands grew at the fastest pace to become the third largest export market, replacing China. This was mainly due to the export of refined petroleum products to the European nation.
On the import front, inbound shipments worth $58.11 billion entered India in March, down 7.89 per cent YoY. On a cumulative basis, the growth in imports was 16.5 per cent at $714 billion during FY23.
Of India’s top ten import destinations, only two nations–Russia and South Korea–saw growth at 258.6 per cent and 23.1 per cent, respectively during March.
The remaining eight nations that saw contraction include–China (-14.8 per cent), UAE (-5.8 per cent), US (-12.2 per cent), Saudi Arabia (-27.4 per cent), Iraq (-36.3), Indonesia (-5 per cent), Singapore (-14.3 per cent), Australia (-3.2 per cent).
These 10 countries comprise 60 per cent of the value of goods imported in March.
Interestingly, Russia overtook Saudi Arabia and Iraq to become India’s second largest import partner in March, as crude oil from the nation continued to rise.
China remained the top import destination, although the country’s share of imports from the neighbouring nation fell to 13.79 per cent in FY23 from 15.43 in FY22.
On the other hand, during March, imports from China contracted nearly 15 per cent to $7.79 billion. Government officials said one of the reasons was that China’s import share in electronic goods has declined. Apart from that, fertiliser imports from China also fell significantly.
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