India: Exports fall in February, export target for current fiscal year likely to be missed
March 11, 2014
The trade deficit totaled USD 8.1 billion in February, which represented a notable improvement compared to the USD 14.1 shortfall recorded in the same month last year. In the 12 months up to February, the trade deficit totaled USD 138.4 billion, which is the lowest cumulative deficit that has been recorded since July 2011. The narrowing trade deficit in February mainly reflected a 17.1% contraction in imports over the same month last year. The reading followed the 18.1% decrease observed in January and represented the sixth consecutive month of double-digit contractions. The steep fall in imports continued to reflect lower purchases of gold, as well as lower imports of oil and non-oil products. Exports fell 3.7% annually in February, which contrasted both the 3.8% increase tallied in January as well as the 3.5% expansion the markets had expected. The reading marked the first contraction in eight months. The 12-month sum of exports up to February totaled USD 313.6 billion. Accordingly, India is likely to miss its export target of USD 325 billion for FY 2013/2014. FocusEconomics Consensus Forecast panelists expect exports to increase 9.0% in FY 2014/2015, reaching USD 351 billion. In FY 2015/2016, the panel sees exports expanding 12.4% and reaching USD 395 billion.
Author: Ricardo Aceves, Senior Economist