India's Export Landscape: A Mixed Bag of Growth and Decline

India's combined exports of merchandise and services rose to USD 62.42 billion in July, marking a yearly rise of 2.81%. While merchandise exports declined slightly, services exports saw an increase. The country's imports also grew, resulting in a widened trade deficit.

In July, India's combined exports of merchandise and services reached USD 62.42 billion, reflecting a 2.81% increase over the previous year, according to data from the Commerce Ministry released on Wednesday. The same period last year saw exports valued at USD 60.71 billion. While merchandise exports fell from USD 34.49 billion to USD 33.98 billion, services exports rose from USD 26.22 billion to USD 28.43 billion during the month.

For June, India's total exports stood at USD 65.47 billion. Over the first four months of the 2024-25 fiscal year, total exports amounted to approximately USD 260 billion, with the government optimistic about meeting its full-year target of USD 800 billion.

Year-on-year imports also saw an increase in July, as was the case in June. Overall imports, comprising both merchandise and services, rose from USD 67.23 billion to USD 72.03 billion, marking a 7.13% rise.

The trade deficit widened from 6.5% to 9.61% in July. In the financial year 2023-24, India achieved record exports of USD 778 billion, surpassing the previous year's USD 776.3 billion. Services exports rose from USD 325.3 billion to USD 341.1 billion during the same period, while merchandise exports dipped from USD 451.1 billion to USD 437.1 billion.

The government launched a Production Linked Incentive (PLI) scheme in various sectors, including electronic goods, to make Indian manufacturers globally competitive, attract investments, enhance exports, integrate India into the global supply chain, and reduce dependency on imports. These measures appeared to have yielded positive results.

Overall imports decreased from USD 898.0 billion in 2022-23 to USD 853.8 billion, with both merchandise and services exports declining during the financial year. The trade deficit significantly improved from USD 121.6 billion in 2022-23 to USD 75.6 billion in 2023-24.

(With inputs from agencies.)