Indian exports likely to surpass $350-billion target for FY15: FIEO

Buoyant over the gradually growing India’s overseas shipments, the Federation of Indian Export Organisations (FIEO) has stated that India’s exports can surpass the $350-billion target for 2014-15 fiscal as growth in the manufacturing sector is expected to pick up pace. The FIEO President Rafeeque Ahmed has stated that global trade scenario is improving with positive development in the US, EU and emerging economies and in coming months exports should reflect these developments.

However, the FIEO President has stated that single digit growth in exports in July was lower than expected and sectors like gems and jewellery, electronics, cotton textiles continue to be cause for concern as their negative growth is pulling down overall exports growth. After registering double-digit growth for two consecutive months, India's merchandise exports grew by 7.33% to $27.73 billion in July from $25.84 billion in the same month of previous year. However, exports rose for the fourth straight month in July, benefiting from a stronger global economy and further depreciation in rupee value.

Petroleum products exports and engineering exports, each representing around 20% share in country's total imports, rose by 28.1% and 23.9% in July over same period last year. Furthermore, textile and pharma exports grew by 13.3% and 10.78% in July from a year earlier. However, gems and jewellery exports contracted by 17.42% y-o-y to $2.9 billion in July due to harsh government’s norms like high customs duty at 10% on precious metals imports and existing 80/20 rule under which 20% of all gold imports by importers has to be re-exported. During April-July’FY15, the value of India’s overseas shipments increased by 8.62% to $107.84 billion from $99.28 billion in the same period of previous financial year.