Exports of five major sectors declined 25% in August
Exports of five of the top 30 sectors closely monitored by the government registered a fall of about 25% in August this year compared to the same month’s shipment value of the last fiscal. The five sectors — petroleum, engineering, gems and jewellery, textiles, and pharmaceuticals – contributed approximately 65% to India's total outbound shipment during last year with collective export value of $202 billion. The country’s overall merchandise exports crossed $310 billion last year. In August this year, the export of these key five sectors reduced to $13.33 billion as against $17.79 billion recorded in August 2014, the latest data of the Commerce Ministry said. The export of petroleum products witnessed the deepest fall of almost 48% in August this year, while that of engineering goods declined 29%. Petroleum product exports fell from 5.32 billion in August last year to 2.77 billion in August this year. Similarly, engineering goods exports dropped to $4.65 billion as against $6.56 billion registered a year ago. The shipment of textiles also slipped 7.39% year on year from $1.38 billion to $1.28 billion in August. However, exports of gems and jewellery as well as drugs and pharmaceuticals sectors saw a marginal increase of 2.66% and 6.05% respectively, the data said. According to Anupam Shah, Chairman of Engineering Export Promotion Council (EEPC), the main reason for the sharp decline in engineering export was the recent increase in duty on steel products without corresponding increase in drawback rate. Steel constitutes a major raw material for engineering sector which contributes up to 20% to the country’s export basket. A recent report of the EEPC said that the slowdown in exports has affected 73% of all the engineering segments, including steel, iron, non-ferrous metals, industrial machinery and auto components. India’s overall merchandise exports fell 20.66% and valued at $21.26 billion in August this year as against $26.80 billion during the same month of the previous fiscal. The country’s export has been facing downward trend for the past nine months. Expressing concern over continuous fall, the EEPC chairman had asked the government to come up with some “concrete schemes” to push exports. “It (the government) needs to relook at the MEIS (Merchandise Exports from India) scheme and create a product-favoured market,” he had said while speaking to The Dollar Business. Meanwhile, the Commerce Ministry is likely to meet exporters next week to discuss measures to improve the sector.