Indian exports to US, China, UAE shrink in September; job-creating sectors such as engineering, apparel hit hardest

New Delhi: India’s exports to US down 10.7% y/y in September China Job-creating industries such as engineering, apparel and cotton yarn were hit the hardest, shrinking 45.8% as the country’s overall shipments plunged 3.5% last month.

Merchandise exports fell in 6 of the top 10 markets, including United Arab Emirates and Bangladesh and 18 of the top 30 major commodities.

Export of engineering products Demand drops 17% due to Covid-19 restrictions slow down In China and Hong Kong, plus a 15% steel export tax. Exports of engineered products to the CIS countries have been hit by the Russia-Ukraine war and Armenia-Azerbaijan tensions.

Likewise, high inventories, sluggish economies, rising and rising interest rates in the US and EU inflation Apparel exports to the UAE and Saudi markets contracted by 21.5% in September.

“High inventories in the EU and US will continue until October, when we may see weak growth in the industry. The industry is expected to pick up after December,” an official said.

Exports of cotton yarn, fabrics and finished goods fell 21% year-on-year in April-September.

The analysis showed that handicraft exports contracted by 30.5% in the first six months of FY23, while carpets contracted by 19.1%.

“We expect Australia’s ECTA to boost exports and it will be necessary to diversify what we export,” the official added.

India aims to achieve $470 billion in merchandise exports by 2022-23. Preliminary data released on October 3 showed that exports from April to September in 2022-23 were US$229.05 billion, a year-on-year increase of 15.54%.

“Exports in certain sectors have declined due to the slowdown in some advanced economies and the consequent slowdown in demand,” the government had said, adding that certain measures to curb domestic inflation and domestic food security concerns also affected export.

In food, India lost market share in rice in Iraq and fruit and vegetables in the UK and Bangladesh.