Exports decline marginally in Dec on global volatility

Merchandise exports in December 2024 declined marginally (one percent) year-on-year to $38.01 billion on volatility in commodity and metal prices, ongoing international trade disruptions and currency fluctuations.

Ashwani Kumar, President, Federation of Indian Export Organisations (FIEO) says: "Geopolitical tensions in the Gulf region further exacerbated logistical challenges, affecting export flows to key markets like Europe, Africa, and the CIS."

Merchandise imports for December rose by five percent to $59.95 billion, says an official release from the ministry of commerce. For April-December 2024, merchandise exports increased by 1.6 percent to $321.71 billion while imports increased 5.15 percent to $532.48 billion.

"Major drivers of merchandise exports growth in December 2024 include electronic goods, engineering goods, rice, readymade garments (RMG) of all textiles and cotton yarn/fabs./made-ups and handloom products," says an official release from the ministry of commerce.

Electronic goods exports increased by 35 percent to $3.58 billion in December 2024 from $2.65 billion in December 2023. "Rice exports increased by 64 percent from $0.87 billion in December 2023 to $ 1.43 billion in December 2024. Exports of RMG of all textiles increased by 13 percent to $1.46 billion in billion from $1.30 billion in December 2023."

Top five export destinations, in terms of change in value, exhibiting positive growth in December 2024 were U.S. (8.5 percent), Saudi Arabia (50.5 percent), France (67 percent), Bangladesh (33.6 percent) and Sri Lanka (83.7 percent), the release added. "Top five export destinations, in terms of change in value, exhibiting positive growth in April-December 2024 compared to April-December 2023 were U.S. (5.6 percent), Netherland (14.7 percent), UAE (8.9 percent), Singapore (16.5 percent) and U.K. (14.1 percent)."

Kumar emphasised on the urgent need for enhanced support in the upcoming Budget, particularly through an expanded production linked incentive (PLI) scheme to boost manufacturing capacity and include labour-intensive sectors. He also highlighted the persistent issue of trade finance, which continues to hinder the global competitiveness of MSMEs, and the importance of a focused export strategy targeting key markets, particularly the U.S., as the tariff war presents new opportunities.