NEW DELHI, Nov 16: India's exports contracted for the third month in a row in October by 1.11 per cent to USD 26.38 billion mainly on account of a significant dip in shipments of petroleum, carpet, leather products, rice and tea.
Imports too declined by 16.31 per cent -- the steepest fall in more than three years -- to USD 37.39 billion in October, narrowing the trade deficit to USD 11 billion, according to the government data released on Friday.
This is the steepest decline in imports since July 2016 when the inward shipments had declined by 19 per cent.
Gold imports increased by about 5 per cent to USD 1.84 billion in the month.
The trade deficit stood at USD 18 billion in October 2018.
Out of the 30 key sectors, as many as 18 segments showed negative growth in exports during the month under review.
Shipments of petroleum goods, carpet, leather products, rice and tea contracted by 14.6 per cent, 17 per cent, 7.6 per cent, 29.5 per cent and 6.16 per cent respectively.
The country's outbound shipments have remained subdued so far this year. It may have a bearing on the overall economic growth, which fell to over six-year low of 5 per cent in the first quarter of the current fiscal. Industrial output declined by 4.3 per cent in September due to poor performance by manufacturing, power generation and mining sectors.
The outbound shipments contracted by 6 per cent in August and 6.57 per cent in September.
In October, oil imports declined by 31.74 per cent to USD 9.63 billion, and non-oil imports fell by 9.19 per cent to USD 27.76 billion.
Cumulatively, during April-October 2019, exports were down 2.21 per cent to USD 185.95 billion while imports contracted by 8.37 per cent to USD 280.67 billion.
Trade deficit during the period narrowed to USD 94.72 billion as against USD 116.15 billion in April-October 2018-19.
Meanwhile, an RBI release showed that services export for October 2019 stood at USD 17.22 billion while imports were at USD 10.92 billion.
Services exports in September 2019 were USD 17.54 billion (Rs 1,25,090.78 crore) registering a positive growth of 7.05 per cent in dollar terms, vis- -vis September 2018.
Services imports in September 2019 were USD 11.10 billion (Rs 79,151.87 crore) registering a positive growth of 11.56 per cent in dollar terms, vis- -vis September 2018.
Ludhiana-based exporter S C Ralhan called for the immediate release of foreign trade policy by the government to arrest the downfall.
"Government should immediately announce foreign trade policy. If it will be delayed, the government would not be able to control the damage," Ralhan said.
Trade Promotion Council of India Chairman Mohit Singla said that the figures reflect global slowdown which has led to the slackening of demand, which is also seen in fall of imports especially in the raw material used for either production or manufacturing.
"I am sure in the next few months efforts taken by the government will show positive results and exports incentives announced by the government will have a positive rub on India's exports," Singla said.
Federation of Indian Export Organisations (FIEO) President Sharad Kumar Saraf said that trade tensions and rising protectionism has led to this marginal decrease in exports during the month.
"Sluggishness in the economies across the globe coupled with the trade war between US-China, Brexit and developments in Iran, Turkey, Iraq other gulf countries has continuously unsettled the slowing world economy which has further escalated the problem," he said.
He added that the downside risks remain and the projections for the near future depends on a return to more normal trade relations among countries. - PTI