December merchandise exports up 40% YoY, hit record $37.81 billion

Outbound shipments up 29% sequentially; Cumulatively, exports in April-Dec crossed $301 bn, achieving three fourth of annual target of $400 bn in first nine months of FY22

Merchandise exports witnessed nearly 40 per cent growth year-on-year (YoY) to $37.81 billion in December, as demand for Indian products continued to remain robust, according to data released by the commerce and industry ministry on Friday.
 
On a sequential basis, outbound shipments grew nearly 29 per cent.

Engineering goods, petroleum products, gems and jewellery, organic and inorganic chemicals, drugs and pharmaceuticals were the top exported goods.

On a cumulative basis, India’s merchandise exports in April-December was over $301 billion, achieving three-fourth of its annual target of $400 billion in the first nine months of the ongoing fiscal year ending March (FY22). The number has also exceeded the total exports figure of FY21, which was at $290 billion.
 
A Sakthivel, the president of the Federation of Indian Export Organisations, said that looking at the current trend, India is on course to achieve the $400-billion merchandise exports target for the current fiscal year.

 
“Spectacular exports growth, coupled with orders in hand, will help in pushing India’s exports further during the next fiscal, thereby aiming for exports in the vicinity of US$ 525-530 billion during FY 2022-23. However, imports clocking $59.48 billion during the month with a very high growth of 38.55 per cent, is a point of concern and should be analysed,” Sakthivel said.
 
India’s merchandise imports in December also witnessed a sharp jump, with shipments worth $59.48 billion coming into the country, up 38.5 per cent year-on-year. As a result, India was a net importer, with a trade deficit of $21.68 billion, compared with a deficit of $12.62 billion in the preceding year.
 
Aditi Nayar, the chief economist, ICRA, said that while the merchandise trade deficit in December pulled back from the levels seen in September and November, benefitting from high exports ahead of the Christmas season, non-oil non-gold imports climbed very sharply.
 
“The surge in non-oil non-precious imports in December 2021 was led by electronic goods, fertilisers, chemicals and coal, all of which reported a YoY increase of more than US$1 billion,”
Nayar said.
 
According to her, the impact of the third wave may squeeze wedding demand for gold, which is expected to help the trade deficit to somewhat scale back from the average of $21.7 billion seen since September 2021.
 
Non-petroleum and non-gems and jewellery exports, also known as core exports, grew nearly 30 per cent YoY to $28.92 billion. In case of such imports, the growth was 34 per cent YoY to $35.47 billion in December.