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India's trade data for August 2024 has drawn mixed reactions from industry experts, reflecting both optimism and concern.
The PHD Chamber of Commerce and Industry (PHDCCI) praised India's resilience in exports, highlighting a robust 5.3 per cent year-on-year growth in overall exports between April and August 2024. The cumulative value of merchandise and services exports during this period reached USD 374.3 billion, up from USD 350.1 billion in the same period in 2023. PHDCCI's President, Sanjeev Agrawal, attributed this growth to rising exports of electronic goods, tea, coffee, spices, and cereal preparations, projecting continued export strength as India's supply chains grow stronger. "We look forward to a great export growth trajectory in the current financial year. As India's supply chains become stronger, the export trajectory is expected to perform robust in the current financial year" said Aggarwal. However, the Federation of Indian Export Organisations (FIEO) painted a more cautious picture regarding August's goods exports, which declined by over 9 per cent year-on-year to USD 34.71 billion. FIEO President, Ashwani Kumar, pointed to global economic uncertainties, falling commodity prices, and logistical challenges as key factors behind this sharp decline. He also highlighted that disruptions in international trade, coupled with falling crude and metal prices, have hurt merchandise exports. Additionally, higher freight costs and shipping difficulties have pushed some exporters to focus on domestic markets instead. "The ongoing international trade disruptions along with drop in crude and metal prices have also played key role in bringing down the value of exports" added Kumar. In the engineering sector, optimism persisted. The Engineering Export Promotion Council (EEPC) India Chairman, Arun Kumar Garodia, reported a 4.36 per cent growth in engineering exports in August 2024, reaching USD 9.44 billion. Cumulatively, engineering goods exports totaled USD 46.41 billion for the April-August period, marking a 4.22 per cent year-on-year increase. However, Garodia noted that the overall performance could have been stronger if not for the decline in iron and steel exports, which he attributed to competitive pricing from China, geopolitical conflicts, and protectionist policies in major markets like the US and EU. "This could be partly attributed to very competitive pricing from China, geopolitical conflicts in Europe and West Asia, and protectionist policies in the USA and EU. Additionally, there is growing concern among the exporting community about Chinese steel entering India through FTA routes, bypassing tariffs intended to protect domestic production" said Garodia. Looking ahead, he also expressed cautious optimism for the engineering sector, citing positive measures from the 2024 Budget and the potential for improved global economic conditions. He also urged a review of free trade agreements (FTAs) to address concerns over Chinese steel entering India through FTA routes. As industry experts weigh the pros and cons of the latest trade data, the path forward for India's export sector remains dependent on both global market conditions and domestic policy interventions. (ANI)
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