India on course to achieve $400 billion export target in FY22

India is well on its course to achieve the $400 billion export target set by the government for fiscal 2021-22. During the first six months of the fiscal till September 30, India’s merchandise exports stood at $197.11 billion, according to data from the country’s ministry of commerce and industry. With power crisis hampering Chinese exports, India may even surpass the target.

India’s merchandise exports in September 2021 was $33.44 billion, according to the preliminary data released by the ministry, taking the total exports in April-September 2021 to $197.11 billion. This is an increase of 56.92 per cent over $125.61 billion exports in April-September 2020 and an increase of 23.84 per cent over $159.16 billion made in April-September 2019.

In September 2021, India’s exports showed an increase of 21.35 per cent over $27.56 billion in September 2020 and an increase of 28.51 per cent over $26.02 billion in September 2019. “If exports continue to grow at this rate in the remaining six months of the current fiscal, India will definitely achieve the target of $400 billion,” says Deepti Lahane, who heads the Market Intelligence division at Fibre2Fashion.

India is well on its course to achieve the $400 billion export target set by the government for fiscal 2021-22. During the first half of fiscal till September 30, India’s merchandise exports stood at $197.11 billion, according to data from the ministry of commerce and industry. With power crisis hampering Chinese exports, India may even surpass the target.

“There are strong indications that China’s export economy will lose steam, at least till December, due to the current power shortage situation in the country which will put a break on production. If some of the orders get diverted to India, as is anticipated, India may well end up the fiscal much higher than the $400-mark,” adds Lahane.

This week Moody’s Investors Service changed the outlook on the Indian government’s ratings to ‘stable’ from ‘negative’ and affirmed the country’s foreign-currency and local-currency long-term issuer ratings and the local-currency senior unsecured rating at Baa3. Moody’s also affirmed India’s other short-term local currency rating at P-3.

The decision to change the outlook to ‘stable’ reflects Moody’s view that “the downside risks from negative feedback between the real economy and financial system are receding.”

Last week, there were apprehensions that India might face a power shortage as 70 per cent of its electricity generation is through thermal power stations that had almost ended up using its stock of coal. However, with the ebbing of the monsoon season and re-start of coal mining activity, power generation plants are likely to run on ‘hand-to-mouth’ situation for a couple of months, before they begin stocking again, without causing much harm to industrial manufacturing, and thereby exports.

The Indian economy is also benefitting from the reforms undertaken by the government during the past 18 months of the pandemic. As Ajay Seth, secretary of economic affairs, Government of India said at a recent FICCI webinar, “There was a very strong emphasis on stepping up the reforms so that economy bounces back, and fast growth rates can be reached.” And the results are now showing.

Fibre2Fashion News Desk (RKS)