Exports to plunge by 13.5% in 2009-10

Although India's exports have started registering good growth since November 2009 after suffering the adverse effects of the global economic slowdown for more than a year, it is likely to fall by 13.5% to US$160 billion at the end of 2009-10.

"Persistence of sluggish demand in chief export destinations such as the US and the European Union (EU) pulled down the country's export figures for major part of the current financial year. Therefore, we estimate exports to reach US$160 billion at the end of 2009-10, as compared to around US$185 billion in 2008-09," said a spokesperson of the Commerce Ministry.

The Ministry further estimates the exports to touch US$200 billion-mark in 2010-11 and US$230 billion in the following financial year. Analysts believe that support to the SME sector will help the government to achieve the set target as small firms contribute significantly to the export sector.

"With global economic conditions improving and export sector gradually coming back on track, achieving the US$200 billion-mark in the coming financial year does not seem improbable," said Vikas Goyal, senior analyst at Ambuj Research, a small-sized securities firm in Kolkata.

Export associations are also optimistic that by registering positive growth for the last few months, the export sector will be able to significantly reduce the margin of shortfalls by the end of 2009-10 that was created due to decline in exports consecutively for 13 months.

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