Exports have always been a vibrant topic for critics of the Modi government. When they have no other area to question the government, they talk about exports, forgetting that the concept of trade involves other nations as well and if these nations are experiencing slowing down in economy then it’s but natural that exports will fall. But now these critics can’t even question the government on this topic.
India’s exports were $23.81 billion in August this year, whereas exports last year in August were $21.59 billion. This is a 10.29% rise on year-on-year basis (YoY) which is extremely significant. This data was released by the Ministry of Commerce and Industry. This growth exports in August means that exports have raised for 12th straight month.
A statement from the ministry read: “In continuation with the positive growth exhibited by exports for the last twelve months, exports during August, 2017 have shown growth of 10.29 per cent in dollar terms valued at $23,818.83 million as compared to $21,597.09 million during August, 2016.”
The major groups that showed growth in August this year over the corresponding month of last year were – engineering goods (19.53%), petroleum products (36.56%), organic and inorganic chemicals (32.41%), drugs and pharmaceuticals (4.21%), and RMG of all textiles (0.56%).
Imports too rose on the same basis and two groups that showed significant rise in imports were electronic goods (27.44%), and machinery, electrical and non-electrical (18.35%). As far as the rise in import of these two commodity groups goes, it can be seen positively. The rise in import of electronic goods is a signal of rising purchasing power of the people, which is why the demand for such goods is on the rise. The import of machinery can also be viewed in the same light as more such products are now being needed in factories and other smaller product-manufacturing units.
Other than exports, other important macro factors of the economy are very stable, most of which are rapidly improving. The noise about the economy being in recession is nonsense. There is no doubt that demonetisation and GST have brought the growth rate down, but that is temporary. In fact, a recovery will most likely be seen in the September quarter.