India’s export and import (EXIM) containerised trade reported 10 per cent growth in the July-September quarter (Q3) as compared with one per cent growth in the same period last year due to improvement in the economies of key export markets and growing demand for imported products in the domestic market, said Maersk Line, in its Q3 trade report titled “India, solid economic growth.”
The containerised trade accounted for approximately 55 per cent of the country’s total EXIM trade volumes. While exports to the U.S. and Europe remained steady, an increased demand from Latin America, Far East and South Africa contributed to the overall export growth of 9 per cent.
“India continues to shine in the global trade growth. This is driven by stability in the U.S. market, ongoing improvement in the European economy and growth in emerging markets such as Latin America with exports to Brazil nearly doubling this quarter as compared to the same quarter last year,” said Franck Dedenis, Managing Director, India, Sri Lanka and Bangladesh Cluster, Maersk Line.
North India led the country’s global trade witnessing a 22 per cent increase in exports and a 26 per cent increase in imports.
Exports
The U.S. and Europe have traditionally been the regions accounting for the largest piece of India’s exports.
However, increased demand has been seen from Saudi Arabia, Turkey and Brazil. Automobiles, Garments and Metals contributed to exports growth.
Strong volume growth in the automobile sector was driven by demand from Egypt, South Africa, Algeria and Brazil and the U.S. Garment and metal volume growth was driven by U.S. and Europe.
Exports of frozen and cut vegetables and an increased demand from the Middle East contributed to growth in agri exports. Fish exports moved up due to a strong shrimp season in East and South India.
China dominated the import market led by consumer electronics and solar panels. Imports from North America rose by 21 per cent due to price competitiveness it offered in commodities such as textiles, apparels, accessories, plastics and rubber. Import of fruits and nuts nearly doubled due to strong domestic demand.
Currency effect
Trade-wise, Maersk Line expected India’s EXIM growth in the fourth quarter to be slower than in the third, as a result of the demonetisation exercise undertaken by the Government in November this year.
“Limited availability of new currency in the hands of people will impact exports in sectors like agriculture due to a high number of cash transactions. We have seen transactions declining in November,” said Mr. Dedenis.
The reduction in consumption of imported goods, especially garments, will hit imports hard in the January-March quarter as importers will reduce their orders in the current quarter.
Source: Thehindu.com