Exports contract 2.84% in November; trade deficit shrinks

India’s goods exports contracted 2.84 per cent (year-on-year) in November 2023 to $33.9 billion as global economic and political turmoil continued to affect demand. But a sharper 4.33 per cent decline in imports to $54.48 billion narrowed the trade deficit to $20.58 billion after a record increase in the previous month to $31.46 billion, per quick estimates released by the Commerce Department on Friday.

“Trade is not one-way traffic. The global context has to be seen. Interest rates have not come down (in major economies) despite the global slowdown. Global conflicts have aggravated. Earlier, there was a Russia-Ukraine conflict, and now we have Hamas and Israel as well,” said Sunil Barthwal, Commerce Secretary, at a media briefing.

Barthwal was referring to UNCTAD’s recent projection for world trade, which estimated a decline of 7.5 per cent in trade in goods in the calendar year 2023. The fall in India’s goods exports in the January–November 2023 period was lower at 5.2 per cent.

 â€œAlthough global trade is suffering, we are holding fort, and our exports have beaten the global trends in 2023 by a significant margin,” the Secretary said.The fall in exports in November 2023 was driven by items such as engineering goods, petroleum products, ready-made garments, chemicals, leather, and marine products.

The decline in imports during the month was primarily due to a fall in petroleum, coal, chemicals and chemical products, fertilisers, and vegetable oil.

Exports for the period April–November 2023, worth $278.80 billion, were 6.51 per cent lower than exports worth $298.21 billion during April–November 2022.

Imports during the April-November 2023 period were 8.67 per cent lower at $445.15 compared with $487.42 billion during April-November 2022.The trade deficit for April–November 2023 was estimated at $166.35 billion against $189.21 billion during April–November 2022.

Despite an overall decline in exports in November 2023, as many as 15 of the 30 key sectors posted an increase. These include gems and jewellery, electronic goods, drugs and pharmaceuticals, cotton yarn and made-ups, carpet, iron ore, fruit and vegetables, and meat and dairy products.