Turning The Tide: India's Goods Exports Surge In October, Breaking Eight-Month Downtrend

After an eight-month hiatus, India's goods exports have witnessed a positive upswing in October, with a preliminary estimate of around a 3 per cent increase over last year's level of $31.6 billion, according to preliminary data accessed by TOI.

However, the official numbers are set to be released on 15 November.

Simultaneously, imports, which have been on a downward trend for nine months, have also displayed signs of improvement.

The recent downturn in exports has been attributed to weak demand and a moderation in commodity prices, which had surged in the wake of the Ukraine conflict.

Additionally, the base effect played a role as exports contracted for the first time in October 2022, following a period of sharp growth that pushed India's goods exports beyond the $400-billion mark in FY22.

While the tension in West Asia has caused apprehension among businesses and markets, economists and policymakers believe that its impact will remain limited unless the situation escalates and more countries become involved.

Despite the challenges in goods exports, the services sector has remained resilient and continues to exhibit positive trends. This has helped narrow the overall trade deficit and keep the current account deficit in check.

Ajay Sahay, the director-general of the Federation of Indian Export Organisations, noted, "If exports are turning positive in these challenging times, it suggests that the industry is on the road to recovery due to the resilience shown by it. Demand is still an issue in many markets due to high inventory, and we may be eating into the share of some other country."

Feedback from exporters indicates that overseas buyers have not canceled orders but have deferred delivery, affecting shipments from India.