India’s exports to remain weak in FY2017

The Dollar Business Bureau

India’s export is expected to stay low in fiscal 2017, India Ratings and Research said in a report on Tuesday.

"We believe that export performance is likely to stay weak in FY17, as globally economies struggle to stabilise,” the research agency said in its report.

India’s export was $62.55 billion in the last quarter of 2015 as compared to $65.53 billion in the third quarter of the previous financial year.

The research agency also believes that the rupee will weaken and will trade at an average of 67.5 in FY17.

“Evidences of linkages between exchange rate and trade performance are weak and do not suggest a strong relation,” the report added.

India’s total export value is expected to be close to $270 billion in 2015-16 as against $317.54 billion in 2014-15. The export value of India in fiscal 2013-15 was $336.61 billion, which shows a continuous declining trend over the years.

“India’s stance of calibrating its exposure both through exports’ composition and destination has supported overall export performance. In order to maintain its overall competitiveness, India’s focus on infrastructural development is likely to have multi-linked benefits,” the report said.

It said infrastructure sector will play a pivotal role in reviving the domestic growth and the growth in this sector will also enable private sectors to enhance cost competitiveness in the domestic market.

For the last six consecutive quarters, India’s exports performance has been dismal. And with the industry as well as market analysts predicting a similar pattern in the financial year 2017, Prime Minister Narendra Modi’s target of doubling India’s exports by 2020 seems too ambitious.

April 13, 2016 | 04:50pm IST