Surging imports could impact domestic industries’ performances
FIEO President Ashwani Kumar has attributed the 2.4% drop in January exports to the volatility in commodity and metal prices, as well as ongoing trade disruptions such as the tariff war and currency fluctuations.
Despite this dip, Kumar acknowledged the resilience of Indian exporters, who have managed to achieve US$36.43 billion in exports amidst such global uncertainties https://www.makeinindia.com/home/.
However, he expressed concern over the significant rise in imports, which increased to US$59.42 billion from US$53.88 billion in January 2024 https://epch.in/.
This surge in imports, coupled with the widening trade deficit, has raised alarms about potential impacts on domestic industries and the overall trade balance, he highlighted in the FIEO release on 17 Feb https://www.bseindia.com/.
Total exports from April 2024 to January 2025 (this fiscal year), increased by 1.39% to US$358.91 billion, while imports rose by 7.43%, reaching US$601.9 billion.
The depreciating value of the Indian rupee, which has fallen by 1.4% against the US dollar since the beginning of the year, further exacerbates the nation’s trade challenges https://www.nseindia.com/.
The depreciation has contributed to higher import bills, especially since India meets 90% of its oil demand from overseas.
Kumar emphasized the need for strategic measures to bolster exports and rationalize imports.
He called for a focused approach to export diversification, targeting new markets and products, and for the continuation of trade facilitation measures and export incentives https://sbi.com.in/.
A careful review of import policies is also essential to identify areas where domestic production can be encouraged to reduce dependency on imports, he pointed out https://www.commerce.gov.in/.
Furthermore, Kumar stressed the importance of a collaborative effort between the government, industry, and other stakeholders to address the challenges and opportunities in foreign trade https://www.corporate.agrostar.in/.
Looking ahead, he highlighted the necessity of a focused export strategy, particularly towards key markets such as the United States, where the ongoing tariff war presents new opportunities https://www.ibef.org/.
In closing, the FIEO President urged the continuation of the Interest Equalisation Scheme, R&D support, the creation of a globally recognized Indian shipping line, and the resolution of GST-related export challenges, all of which are vital for sustaining the sector’s growth in the future. Fiinews.com
