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Declining trend in exports does not augur well for the economy, says FIEO president

Updated: Oct 16, 2019 07:56:37am
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Declining trend in exports does not augur well for the economy, says FIEO president

New Delhi, Oct 16 (KNN) Federation of Indian Export Organisations (FIEO) President Sharad Kumar Saraf has said that declining trend in exports does not augur well for the overall growth of the economy.

''Declining trend in exports does not augur well for the overall growth of the economy. Escalating trade tensions that has unsettled the slowing world economy have also led WTO to sharply cut their trade forecasts for both 2019 and 2020 to 1.2 and 2.7 respectively. The downside risks still remain high in the global economy and the projection for 2020 depends on a return to more normal trade relations,'' he said in a press release on Tuesday

"Domestic issues including access to and cost of credit still remains a problem area for MSMEs and especially for merchant exporters, interest equalization support to all agri exports should be quickly and seriously looked into,'' he added.

The softening of commodities prices including crude, US-China Trade war, Brexit and developments in Iran, Turkey and other gulf nations has further aggravated the problem of the world economy. The uncertainty attached has also affected the flow of investment and added to currency volatility.

Only 8 out of 30 major product groups were in positive territory during September 2019 including electronic goods, drugs & pharmaceuticals, mica, coal & other ores, minerals including processed minerals, ceramic products and glassware and iron-ore sectors which showed some growth. However sectors like tea, spices and fruits & vegetables showed only marginal growth during the month. All other major sector of exports including almost all labour-intensive sector of exports besides petroleum were in the negative, showing such a decelerating trend. However, imports of USD 36.89 billion during the month has again come in the form of some respite for the economy showing a decline of -13.85 per cent.

Saraf further said WTO complaint scheme of newly launched RoDTEP should be immediately deliberated and drafted to give a much needed boost to the exports sector.

According to the government data released on Friday,  India's exports remained in the negative zone for the second consecutive month in September contracting by 6.57 per cent to USD 26 billion mainly on account of significant dip in shipments of petroleum, engineering, gems & jewellery and leather products.

Imports too declined by 13.85 per cent to USD 36.89 billion in September, narrowing the trade deficit to a seven-month low of USD 10.86 billion.

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