chapter-3 trends in india’s foreign...

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India’s Trade Performance

India’s merchandise exports reached a level of US $ 304.62 billion during 2011-12 registering a growth of 21.30 percent as compared to a growth of 40.49 percent during the previous year. Despite the recent setback faced by India’s export sector due to global slowdown, merchandise exports still recorded a Compound Annual Growth Rate (CAGR) of 20.3 per cent from 2004-05 to 2011-12.

World Trade Scenario

As per IMF’s World Economic Outlook January, 2013, the volume of world trade (goods and services) in 2012 slowed down to 2.8 per cent compared to the 5.9 per cent achieved in 2011. As per IMF projections, growth in the volume of world trade is expected to rise to 3.8 per cent in 2013.

The IMF has put its growth projections of world output at 3.5 per cent in 2013. The advanced

Chapter-3

Trends in India’s Foreign Trade

economies are expected to grow at 1.4 per cent while the emerging and developing economies to grow at 5.5 per cent in 2013. The projected growth rates in different countries are expected to determine the markets for our exports.

As per WTO’s International Trade Statistics, 2012, in merchandise trade, India is the 19th largest exporter in the world with a share of 1.7 per cent and the 12th largest importer with a share of 2.5 per cent in 2011.

Exports

Exports recorded a growth of 21.30 per cent during Apr-Mar 2011-12. The Government has set an export target of US $ 360 billion for 2012-13. The merchandise exports have reached US $ 265.95 billion in 2012-13 (Apr.-Feb.). Export target and achievement from 2004-05 to 2011-12 and 2012-13 (Apr.-Feb.) is given in the Chart 3.1 below:

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Annual Report 2012-13

Imports

Cumulative value of imports during 2012-13 (Apr.-Feb.) was US $ 448.04 billion as against US $ 446.94 billion during the corresponding period of the previous year registering a growth of 0.25 per cent in $ terms. Oil imports were valued at US $ 155.57 billion during 2012-13 (Apr.-Feb.) which was 11.92 per cent higher than oil imports valued US $ 139.00 billion in the corresponding period of previous year. Non-oil imports were valued at US

$ 292.47 billion during 2012-13 (Apr.-Feb.) which was 5.03 per cent lower than non-oil imports of US $ 307.94 billion in previous year.

Trade Balance

The Trade deficit in 2012-13 (Apr.-Feb.) was estimated at US $ billion 182.09 which was higher than the deficit of US $ 169.81 billion during 2011-12 (Apr.-Feb.). Performance of Exports, Imports and Balance of Trade during 2004-05 to 2012-13 (April-Feb.) is given in the table below:

(Values in Rs crores)

S. No

Year Exports %Growth Imports %GrowthTrade

Balance

1 2004-2005 3,75,340 27.94 5,01,065 39.53 -1,25,725

2 2005-2006 4,56,418 21.60 6,60,409 31.80 -2,03,991

3 2006-2007 5,71,779 25.28 8,40,506 27.27 -2,68,727

4 2007-2008 6,55,864 14.71 10,12,312 20.44 -3,56,448

5 2008-2009 8,40,755 28.19 13,74,436 35.77 -5,33,680

6 2009-2010 8,45,534 0.57 13,63,736 -0.78 -5,18,202

7 2010-2011 11,42,922 35.17 16,83,467 23.45 -5,40,545

8 2011-2012(Provisional) 14,59,281 27.68 23,44,772 39.28 -8,85,492

9 2011-12 (April-February) Press Release

13,20,836

21,32,198

-8,11,362


14,46,627 9.52 24,36,564 14.27 -9,89,938

Data Source : DGCIS, Kolkata

(Values in US$ Millions)

S. No. Year Exports %Growth Imports %Growth Trade

Balance

1 2004-2005 83,536 30.85 1,11,517 42.70 -27,981

2 2005-2006 1,03,091 23.41 1,49,166 33.76 -46,075

3 2006-2007 1,26,414 22.62 1,85,735 24.52 -59,321

4 2007-2008 1,63,132 29.05 2,51,654 35.49 -88,522

5 2008-2009 1,85,295 13.59 3,03,696 20.68 -1,18,401

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CHAPTER-3 Trends in India’s Foreign Trade

Exports of Principal Commodities

Disaggregated data on exports of Principal Commodities, both in Rupee and Dollar terms, available for the period 2012-13 (April-January) as compared with the corresponding period of the previous year are given in Appendix at Table 3.1 and Table 3.2 respectively. Exports of the top five commodities during the period 2012-13 (April-January) registered a share of 50.8 per

cent in US $ terms mainly due to significant contribution in the exports of Petroleum (Crude & Products), Gems & Jewellery, Transport Equipments, Machinery and Instruments and Drugs, Pharmaceuticals & Fine Chemicals.

The share of top five Principal Commodity Groups in India’s total exports during 2012-13 (April-January) is given at Chart 3.3.

6 2009-2010 1,78,751 -3.53 2,88,373 -5.05 -1,09,621

7 2010-2011 2,51,136 40.49 3,69,769 28.23 -1,18,633

8 2011-2012(Provisional) 3,04,624 21.30 4,89,181 32.29 -1,84,558


2,77,125

4,46,939

-1,69,814


2,65,946 -4.03 4,48,037 0.25 -1,82,090

Data Source: DGCIS, Kolkata

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The export performance (in terms of growth in US $ terms) of top five commodities during 2012-13

(April-January) vis-a-vis the corresponding period of the previous year is shown in Chart 3.4.

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Plantation Crops

Export of Plantation crops during 2012-13 (April–January), decreased by 9.95 per cent in US $ terms compared with the corresponding period of the previous year. Export of Coffee registered a negative growth of 11.44 per cent, the value decreasing from US $ 741.05 million to US $ 656.26 million. Export of Tea also decreased by 8.50 per cent.

Agriculture and Allied Products

Agriculture and Allied Products as a group include Cereals, Pulses, Tobacco, Spices, Nuts and Seeds, Oil Meals, Guargum Meals, Castor Oil, Shellac, Sugar & Molasses, Processed Food, Meat & Meat Products, etc. During 2012-13 (April–January), exports of commodities under this group registered a growth of 27.57 per cent with the value of exports increasing from US $ 21353.59 million in the previous year to US $ 27240.35 million during the current year.

Ores and Minerals

Exports of Ores and Minerals were estimated at US $ 4389.03 million during 2012-13 (April-January) registering a negative growth of 35.48 per cent over the same period of the previous year. Sub groups viz. Iron Ore, Mica, Other ores & minerals and Coal have recorded a negative growth of 64.99 per cent, 0.80 per cent, 9.46 per cent and 5.24 percent respectively. Processed minerals registered a growth of 12.14 per cent.

Leather and Leather Manufactures

Export of Leather and Leather Manufactures recorded a negative growth of 2.22 per cent during 2012-13 (April-January). The value of exports decreased to US $ 3973.92 million from US $ 4064.33 million during the same period of the previous year. Exports of Leather and Manufactures have registered a growth of 3.98 per cent and Leather Footwear registered a negative growth of 10.01 per cent.

Gems and Jewellery

The export of Gems and Jewellery during 2012-13(April-January) decreased to US $ 34758.78 million from US $ 38755.30 million during the corresponding period of last year showing a negative growth of 10.31 per cent.

Chemicals and Related Products

During the period 2012-13 (April-January), the value of exports of Chemicals and Related Products increased to US $ 34686.90 million from US $ 32319.14 million during the same period of the previous year registering a growth of 7.33 per cent. Basic Chemicals and Pharmaceuticals & Cosmetics and Rubber, Glass & Other Products have registered a positive growth and Residual Chemicals and allied products and Plastic & linoleum registered a negative growth.

Engineering Goods

Items under this group consist of Machinery, Iron & Steel and Other Engineering items. Export from this sector during the period 2012-13(April-January) stood at US $ 45543.37 million compared with US $ 47966.60 million during the same period of the previous year, registering a negative growth of 5.05 per cent. The growth in export of Other Engineering items stood at 5.78 per cent, Machinery & Instruments stood at 3.53 per cent and Machine Tools stood at 4.59 per cent.

Electronic Goods

During the period 2012-13 (April-January), exports of Electronic Goods as a group was estimated at US $ 7102.84 million compared with US $ 7441.50 million during the corresponding period of last year, registering a negative growth of 4.55 per cent.

Textiles

During the period 2012-13 (April-January), the value of Textiles exports was estimated at US $ 21200.12 million compared with US $ 22447.75 million in the corresponding period of the previous year, recording a negative growth of 5.56 per cent. The

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export of Readymade Garments, Manmade Textiles & Made Ups, Natural Silk Textiles, Wool and Woolen manufactures, Coir and coir manufactures and Jute manufactures registered negative growth of 7.80 per cent, 12.61 per cent, 23.34 per cent, 19.98 per cent, 7.18 per cent and 16.37 per cent respectively. However, Cotton yarn/Fabrics/Made-ups etc. registered a positive growth of 6.38 per cent.

Handicrafts and Carpets

Exports of Handicrafts declined to US $ 180.51 million during 2012-13 (April- January), from US $ 214.84 million during the corresponding period of the previous year registering a negative growth of 15.98 per cent. Export of carpets increased to US $ 812.17 million from US $ 699.26 million during the same period last year registering a growth of 16.15 per cent.

Project Goods

During 2012-13 (April-January), the export of Project Goods were estimated at US $ 87.70 million compared with US $ 44.10 million during the corresponding period of last year registering a substantial growth of 98.88 per cent.

Petroleum Products

Export of Petroleum Products increased to US $ 48613.38 million during 2012-13 (April- January),

as compared with US $ 46489.12 million during the same period of last year recording a growth of 4.57 per cent.

Cotton Raw including Waste

There was a negative growth in the exports of Cotton Raw including waste by 21.13 per cent from US $ 3326.67 million in 2011-12 (April-January) to US $ 2623.68 million during 2012-13 (April-January).

Imports of Principal Commodities

Disaggregated data on imports of principal commodities, both in Rupee and Dollar terms, available for the period 2012-13 (April– January), as compared to the corresponding period of the previous year are given in Appendix at Table 3.5 and Table 3.6 respectively. Imports of the top five commodities during the period 2012-13 (April-January) registered a share of 61.8 per cent mainly due to significant imports of Petroleum (Crude & Products), Gold, Electronic Goods, Machinery except electrical and electronic and Pearls, precious and semi-precious stones.

The share of top five Principal Commodity in India’s total imports during 2012-13 (April– January) is given at Chart 3.5.

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Fertilizers

During 2012-13 (April– January), import of Fertilizers (manufactured) decreased to US $ 6991.61 million from US $ 8718.13 million in April-January 2011-12 recording a negative growth of 19.80 per cent.

Petroleum Crude & Products

The import of Petroleum Crude & Products stood at US $ 140729.62 million during 2012-13 April - January as against US $ 125871.43 million during the same period of the previous year registering a growth of 11.80 per cent.

Pearls, Precious and Semi-Precious Stones

Import of Pearls, Precious and Semi-Precious Stones during 2012-13 (April– January) decreased to US $ 17696.44 million from US $ 26339.27 million during the corresponding period of the previous year registering a substantial decline of 32.81 per cent.

Capital Goods

Import of Capital Goods, largely comprises of Machinery, including Transport Equipment

and Electrical Machinery. Import of Machine

Tools, Non-Electrical Machinery, and Electrical

Machinery registered a negative growth of 4.67

per cent, 6.94 per cent, 6.45 per cent respectively

and Transport Equipment registered a positive

growth of 0.04 per cent.

Organic and Inorganic Chemicals

During 2012-13 (April–January), import of

Organic and Inorganic Chemicals increased to US

$ 16116.77 million from US $ 15837.29 million

during the same period of last year, registering

a growth of 1.76 per cent. Import of Medicinal

and Pharmaceutical Products increased to US $

2550.01 million from US $ 2446.88 million during

the corresponding period of last year registering

a growth of 4.21 per cent

Coal, Coke & Briquettes

During 2012-13 (April–January), import of Coal,

Coke & Briquettes decreased to US $ 13301.43

million from US $ 14851.58 million during the same

period of last year, registering a negative growth of

10.44 per cent.

The import performance by growth of top five Principal commodities during 2012-13 (April–January) vis-

a-vis the corresponding period of the previous year is shown at Chart 3.6.

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Gold & Silver

During 2012-13 (April–January) import of Gold and Silver decreased to US $ 46769.39 million from US $ 51751.03 million during the corresponding period of the previous year registering a negative growth of 9.63 per cent.

Direction of India’s Foreign Trade

The value of India’s exports and imports from major regions/ countries both in Rupee and Dollar terms are given in Appendix at Table 3.3, 3.4, 3.7 and 3.8 respectively. Share of major destinations of India’s Exports and sources of Imports during 2012-13 (April– January) are given in Chart 3.7 and 3.8 respectively.

countries (27) comprises 16.99 per cent. During the period, USA (12.89 per cent) has been the most important country of export destination followed by UAE (12.20 per cent), Singapore (4.79 percent), China (4.59 per cent) and Hong Kong (3.95 per cent).

Asia accounted for 60.08 per cent of India’s total imports during the period followed by Europe (17.39 per cent) and America (11.64 per cent). Among individual countries the share of China stood highest at (11.21 per cent) followed by UAE (7.67 per cent), Saudi Arabia (6.78 per cent), Switzerland (6.01 per cent) and USA (5.00 per cent).

During the period 2012-13 (April–January), the share of Asia comprising of East Asia, ASEAN, West Asia, Other West Asia, North East Asia and South Asia accounted for 50.78 per cent of India’s total exports in US $ terms. The share of Europe and America in India’s exports stood at 18.88 per cent and 18.77 per cent respectively of which EU

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