Eurozone Crisis Hampers India's Export Growth.

The eurozone crisis has begun to hit Indian exports which registered a meager 10.8 percent growth year-on-year to US$19.9 billion in October, the lowest in the last two years, according to preliminary data released Tuesday.

Being pushed by expensive crude oils and vegetable oils, imports grew at a faster rate of 21.7 percent to US$39.5 billion, leaving a trade deficit of US$19.6 billion — the highest ever in any month in the last four years.

After a whopping 82-percent rise in July this year, export growth has been slipping, and it recorded a growth of 44.25 percent in August, 36.36 percent in September and 10.8 percent in October.

“In any sector, it is the lowest in the last three months, deceleration is uniform,” India's Commerce secretary Rahul Khullar told reporters here.

But, for the cumulative April-October period, exports aggregated to US$179.8 billion, showing a handsome growth of 46 percent, thanks to sterling trend witnessed in the previous months of the current financial year.

“The picture is not going to be rosy for the next six months,” he said.

A steady rise of 31 percent in imports for the seven-month period to US$273.5 billion has left a wide trade gap of US$93.7 billion.

“Balance of trade is something to be very worried about because at this rate, it is going to breach US$150 billion mark (for 2011-12),” Khullar said.

The sectors, which depend heavily on the European markets, have been hit hard. The electronic goods have shown a deceleration of 18 percent in October.

“Clearly, that is where the growth has contracted ... effect of what is happening there,” he said.

The export growth during the month under review has been the lowest since October 2009 when it contracted by 6.6 percent.

Reacting to the sharp decline in exports growth, Ramu S. Deora, president of the Federation of Indian Export Organizations, said that looking at global developments, he had anticipated that exports would suffer in third and fourth quarter of the year.

Source : chinapost.com.tw