In the history of Indian exports the year 2020-21 was undoubtedly the most topsy turvy with the first wave of Corona massively destabilising the goods flow particularly in the first quarter. After a low pick later, there was, however, a case of smart recovery in the last two quarters which had triggered the expectation of a bumper growth in 2021-22. But with Corona reappearing in a more devastating form now, will it throw a spanner in the exports growth momentum witnessed in the recent months? The stakeholders in the business are grappling with this moot point today even as they have divergent views.
“I would not say that I strongly fear goods outflow through our network falling sharply in the coming months. But with India emerging as the global epicentre of Corona this time with new and more dangerous variants, there are enquiries from some countries if the goods dispatched from here are safe and what special precautions we are taking. If the situation further worsens, it may have a serious bearing,” senior executive of a leading global freight forwarder (who did not wish to be named) said. The company has India-Europe trade-lane as its stronghold.
Speaking with indoasiancommodities, Sharad Saraf, President of apex industry body of exporters, FIEO (Federation of Indian Exporter Organisations) strongly maintained that no cracking signs have appeared in exports flow so far, nor is there any concrete indication of a serious near term disruption.
“How things will evolve in a month’s time, nobody can predict. But so far, we haven’t noticed any preliminary signs of any major disruption. With exports being in the list of essential services, critical logistics support system is working fine. We haven’t heard from any export oriented industrial cluster in the country of any slowdown in operations. Nor has there been any case of buyers cancelling their demands from Indian exporters,” Saraf strongly emphasised.
The recently released full year report of Indian exports in 2020-21 had surprised many as it marked a minor single digit drop of 7 percent against the previous fiscal. In 2019-20, Indian exports had stood at $313 billion which dropped to $290 billion in Corona (first wave) affected 2020-21. Earlier in the year, analysts were predicting a massive annual fall considering the poor performance in the first half of the financial year.
Meanwhile, the exports rally witnessed in the last six months of 2020-21 was led by agri- commodities and pharma and surprisingly even static segments like engineering goods and textiles have shown some uptick. In March alone, 28 out of 30 major exports categories reported double digit growth with cereals, oil meals, iron ore, jute, electronic goods, and engineering goods being the leading products.
“After the last year’s number was out, I had maintained that we should be eyeing $350 billion exports in 2021-22 and there is no change in my stance despite a fresh round of Corona surge. Many segments of our exports industry are flush with fresh orders and all stakeholders, including our buyers, are now more matured to deal with this kind of situation after last year’s experience,” Saraf added.