Mundra port
Mundra portReuters

The export growth dipped to 7.33 percent in July, after recording two digit figures in the last two months, in turn pushing up the trade deficit to a one year high of $12.2 billion.

Export in July was worth $27.72 billion as compared to $25.83 billion in the same period during the previous year. In June and May, growth was 10.22 percent and 12.4 percent respectively.

Exports surged in the below mentioned sectors:

Sector Surge in %
Textiles 13.3
Petroleum Products 28
Engineering 23.9
Leather 17.23
Marine Products 25
Oil Seeds 19.25
Chemicals 16.67
Pharmaceuticals 10.78

Import slipped in the below mentioned sectors:

Sector Dip in %
Fertiliser 27.38
Machine Tools 10
Transport Equipment 47.86
Cotton Textiles 4.38

Sectors that registered negative growth:

Sector Dip in %
Tea 8.72
Rice 21.68
Tobacco 12.64
Edible Oil 47.73
Iron Ore 72
Gems and Jewellery 17.42
Electronic Goods 20.14
Cotton Textiles 4.38

The imports increased by 4.25 percent year on year to $39.95 billion in July. This is the second consecutive growth in inbound shipments, after incurring losses in the past few months, reported PTI.

Trade deficit has reached a one year high at $12.2 billion after recording another high of $12.49 billion in July 2013.

"There is nothing to worry on the trade deficit front till oil prices remain low. If EU and US recovery continues, no matter how mild, our exports will post a healthy growth," The Economic Times quoted DK Joshi, chief economist at Crisil.

According to exporter firm Body Fieo, gems, jewellery and electronics continue to be a cause of concern, as loss in these commodities has pulled down the overall exports growth. It opined that the government has to direct few major policies in the forthcoming Foreign Trade Policy to boost exports.

While in the April-July period exports grew by 8.62 percent, imports dipped by 3.8 percent to USD 153.15 billion. 

Oil imports during April-July 2014 rose by 6.65 percent at $455.14 billion. However, non-oil imports slipped by 8.82 percent to $98.01 billion during the same period.

July recorded higher order flows into India following improvement in the US economy.

"Global trade scenario is improving with positive developments in the EU, US and emerging economies. In the coming months, exports should reflect these developments. We can cross $350 billion of exports in 2014-15 as manufacturing is expected to pick up," said M Rafeeque Ahmed, president, FIEO.

The government is expected to announce a five-year foreign trade policy for (2014-19) soon, said Commerce Secretary Rajeev kher.