FIEO concerned for export growth amid increasing protectionism, geo-political uncertainties

April 16, 2018: FIEO president GK Gupta has said that although the exports data for the financial year 2017-18 are encouraging but FIEO is concerned and worried about the labour-intensive sectors such as gems and jewellery, RMG of all textiles, jute manufacturing including floor covering, carpets, agri products and many other sector of exports, dominated by MSME, which are into negative territory. These sectors are still facing the problem of liquidity as banks and lending agencies are tightening their norm, which does not augur well for exports for the new fiscal, said Gupta. He also added that though the WTO’s forecast for global trade in 2018 is at 4.4 percent and may moderate to 4 percent during 2019 showing encouraging scenario for global exports, trade tensions may pose some challenges for exports.

FIEO Chief also expressed his concern with the rising trade deficit, primarily on account of swelling of crude imports bill with northward movement of prices. Moreover, the export growth has not been able to keep pace with import growth, which for the month of March, 2018 showed a growth of 7.15 percent against export growth of -0.66 percent, leading the trade deficit for the fiscal to surpass well over $150 billion mark.

Only 18 out of 30 major product groups were in positive territory during March, 2018 including engineering, organic & inorganic chemicals, drugs & pharmaceuticals, cotton yarn/fabs/made-ups, handloom products and rice.

Gupta said that domestic issues affecting exports should be looked into as global challenges and increasing protectionism, has led to world largest exporter, China’s exports to also fall by 2.7 percent during March, 2018 recording a rare trade deficit of $4.98 billion.