July trade gap widens.

NEW DELHI: Exporters are demanding special package for certain sectors in the revised Foreign Trade Policy (FTP) scheduled on August 23. The demand came after the Commerce Ministry announced the trade deficit figure for the month of July.

 India’s merchandise exports rose by 13.2 per cent to $16.24 billon in July, while imports grew by 34.3 per cent to $29.17 billion.

“Trade deficit is much larger than it used to be before. Exports grew only 13.2 per cent. This is not a good number,” Commerce Secretary Rahul Khullar said during a media interaction.

However, Khullar said  a target of $200 billion is achievable even at a steady export growth of 15 per cent from now on. Sectors which did not perform well in July include leather, electronic goods, man-made fibre, textiles and tea, Khullar said.

Khullar also stated that during April-July 2010-11, exports reached a level of $68.6 billion at a growth of 30.1 pe cent, while the imports were $112.2 billion with a growth of 33.3 per cent and a trade deficit of $43.6 billion.

Concurring with the views of the Commerce Secretary that India will achieve the export target  of $200 billion fixed for the current fiscal and may even surpass it, A Sakthivel, President of Federation of Indian Export Organisation, called for specific package for  apparel, textiles, leather, tea, which are not exhibiting growth, in the revised FTP.

The growth in imports is attributed to imports of coal and fertilizers almost doubled. However, imports of crude oil grew by only four per cent during the April to July period this year.

 The Prime Minister’s Economic Advisory Council expects exports to overshoot the Commerce Ministry’s target of $200 billion, which was set against $176.6 billion achieved in FY10. It projects merchandise exports at $254 billion in financial year 2011-12.

Source : expressbuzz.com