Exports growth fastest in 7 months

Exports grew at doubledigit pace for the first time in seven months during May reducing the year- on- year trade deficit and providing a shot in arm for the Narendra Modi-led government.

Figures released by the commerce ministry on Wednesday showed that exports rose 12.4 per cent to $ 28 billion in May from a year earlier on the back of a healthy growth in engineering, petroleum products and garments shipments. Imports fell 11.4 per cent to $ 39.23 billion. This led to the trade deficit narrowing to $ 11.23 billion from $ 19.37 billion a year earlier. The gap was wider than April's $ 10.1 billion as the oil import bill shot up due to higher global crude prices.

Asked about the export target for 2014- 15, an upbeat commerce secretary Rajeev Kher said, "We are working towards something like $ 1 billion exports on a daily basis." Exports have risen in recent months due to a pick- up in demand from Europe and the United States and a weaker rupee while strict controls on gold imports have helped prevent a brewing balance of payments crisis last year. Kher said that the two countries would start trade talks in July and could hold a ministerial- level engagement in October after an expected summit between Modi and President Barack Obama in Washington.
 
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