Exports figures show higher demand abroad for Indian goods

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Bikky Khosla | 05 Apr, 2011
As the country's exports grew by nearly 50 percent in February it's no secret that the rising demand from new markets including Asia, Latin America and Africa has helped in achieving this impressive growth. Without doubt this 11-month high will not only help in surpassing the target set for the last fiscal (2010-11), but will also give a renewed confidence for the current fiscal (2011-12) which started in April.

While the US market showed some signs of revival, demand from another traditional market for Indian exporters, Europe, is still sluggish. Although the US and Europe are traditional markets for Indian exporters, after the global economic crisis, exporters increased their engagement in new markets of Asia, Latin America and Africa which has now borne fruit.

If we look at the sectors that did well in the last 11 months, the engineering sector tops the list with 81 percent, followed by cotton yarn and made-ups at 43 percent, electronics at 40 percent, petroleum and oil lubricants at 34 percent, and chemicals at 22 percent.

This impressive growth in exports in these sectors, particularly the engineering sector, is owing to the good number of orders from the US, Latin American and Middle East markets. Since the government is providing duty incentives to exporters for these new markets, going by this trend, I feel the country's exports can touch the magical figures of USD 230-235 billion.

Meanwhile, the export strategy released recently by the Commerce Ministry too has rightly aimed at doubling of exports in textiles, tripling of shipments in gems and jewellery and engineering, tripling of exports in electronic goods, doubling of agri exports and tripling leather sector exports.

However, the sectors which registered a decline are iron ore, fruits and vegetables, tea and cotton yarn. This is basically on account of restrictions imposed on overseas shipments.

I feel that going by the current trend, by 2014, we can expect to double exports to $450 billion with engineering, chemicals, gems and jewellery and leather products leading the way.