New Delhi: After inflation, the second biggest macroeconomic worry is the burgeoning trade deficit. Here’s some good news on that front at last. India’s exports rose the most in eleven months, provisional data showed. Exports in February rose 49.8% to $23.6 billion. This not only raises hopes of improving current account deficit numbers but will also exceed government’s export target of $200 billion.
With February’s numbers, exports for 11 months (April-February), of the current fiscal year, rose 31.4% to $208.2 billion. With one month to spare, the government comfortably beat its own forecast of 15% growth rate. Now it can revise the trade deficit and estimate numbers a bit favorably.
However, it remains to be seen how the government will manage the current account deficit for the coming year. Surging crude prices will be major hindrance. Import growth numbers came in lower at –11.1% in December and petered down to 13.1% January. But with crude oil galloping away, it may not be sustainable.