New Delhi, March 14 (FN Bureau) India’s overall exports (merchandise and services combined) in February 2022 jumped 25.41 per cent year-on-year to $ 57.03 billion, data released by Commerce Ministry showed on Monday. Merchandise exports in February 2022 were $ 34.57 billion, as compared to $ 27.63 billion in February 2021 registering a positive growth of 25.10 per cent. Among the major items which led the growth were engineering goods, petroleum products, textiles and chemicals. Driven by sharp year-on-year growth in non-gold imports, merchandise imports in February 2022 were $ 55.45 billion recording 36.07 per cent increase over imports of $ 40.75 billion in February 2021. The merchandise trade deficit for February 2022 stood at $ 20.88 billion.
“While higher commodity prices will inflame imports in March 2022, the volume of oil imports will play a key role in determining the size of the trade deficit. We expect the trade deficit to remain higher than $20 billion in the ongoing month,” ICRA Chief Economist Aditi Nayar said. “With the sharp rise in the trade deficit, we expect the current account deficit to have crossed 3 pe cent in Q3 FY2022, for the first time since the June 2013 quarter, before receding somewhat in the ongoing quarter,” she further said. For FY2023, ICRA has projected the current account deficit at 2.8 per cent of GDP if the crude oil price averages at $115 per barrel, the likelihood of which will crucially depend on the duration of the geopolitical tensions. Amid the Russia-Ukraine crisis, the global crude and commodity prices have been on the rise.
Given that India imports nearly 85 per cent of its energy needs the higher prices would result in increase in trade deficit. Meanwhile, government is expected to exceed its merchandise exports target of $ 400 billion for the financial year 2021-22. Merchandise export for the period April-February 2021-22 was $374.81 billion as against $ 256.55 billion during the period April-February 2020-21, registering a positive growth of 46.09 per cent. Overall exports (merchandise and services combined) in April-February 2021-22 soared 36 per cent to $ 601.77 billion over the same period last fiscal.