Business:  India's overall exports, combining merchandise and services, fell by 2.4% in August, reaching USD 65.4 billion compared to USD 67 billion in the same month last year, according to Commerce Ministry data released on Tuesday. Merchandise exports dropped to USD 34.71 billion from USD 38.28 billion, while services exports rose to USD 30.69 billion from USD 28.71 billion.

Year-to-date performance and future outlook

For the first five months of 2024-25 (April-August), total exports stood at USD 328.86 billion, reflecting a 5.35% year-on-year increase. Despite the recent dip, the government remains optimistic about achieving its full-year export target of USD 800 billion.

Imports and trade deficit increase

India's overall imports in August rose by 3.45%, reaching USD 80.06 billion, up from USD 77.39 billion the previous year. This led to a widening of the trade deficit, which increased from USD 10.39 billion to USD 14.66 billion in August.

Record exports in FY 2023-24

India recorded USD 778 billion in exports in the financial year 2023-24, with services exports rising to USD 341.1 billion and merchandise exports slightly declining to USD 437.1 billion. Despite this, overall imports fell from USD 898 billion in 2022-23 to USD 853.8 billion, significantly reducing the trade deficit from USD 121.6 billion to USD 75.6 billion.

Government initiatives show positive impact

The government’s Production Linked Incentive (PLI) scheme, aimed at boosting domestic manufacturing and exports, has contributed to making Indian manufacturers globally competitive and reducing the country's import dependence. The initiative is showing signs of success in sectors like electronics and other key industries.