TRADE UPDATE #104

New Strain

27/02/2021

After declining for most of 2020 due to Covid-19 pandemic, Indian exports picked pace in December 2020 and January 2021. Exports upticked by 0.14% in December, and further rose to 6.16% in January. Infact, according to news reports, the Commerce Minister is assertive that Indian exports are safely out of the covid induced trade slump as non-oil, non-jewellery shipments continue to grow.

However, in a recent report, World Trade Organization (WTO) remained cautious with the appearance of new variants of the coronavirus, which is likely to have an impact on the global trade in the first quarter of 2021.


INTERNATIONAL TRADE

Global merchandise trade growth may not be sustainable, says WTO

The World Trade Organization (WTO) said the high rate of global merchandise trade growth (in volume) during the fourth quarter of 2020 is unlikely to sustain in the first half of 2021 since key indicators appear to have already peaked. This may have repercussions on exports from India which have started recovering of late, say experts.


EXPORTS

Exclusive | Government feels worst is over for India's exports as non-oil, non-jewellery shipments rise steadily

The Commerce Department is hopeful that the worst is over for India's exports, as it points to export categories beyond India's two-largest forex earning sectors - petroleum and gems & jewelry - continuing to see growth on a monthly basis. In January, the latest month for which the Commerce and Industry Ministry has released trade data, non-oil, non gems & jewellery exports rose sharply by 13 per cent, after growing 5.5 per cent in December.


EXPORTS

India needs to get into cutting edge tech to boost exports: Amitabh Kant

India now needs to get into cutting edge technology to boost exports which will benefit sectors like telecom, automobiles, battery storage devices and solar energy, Niti Aayog CEO Amitabh Kant said on Tuesday. Kant, speaking at the launch event for CII's report 'Foreign Trade & Investment in India: Unlocking Key Opportunities through Strategic Reforms', further said the country is at the cusp of a transformation.


BILATERAL TRADE

India's exports to China up 16.15% to $20.87 billion in 2020

India's exports to China has increased by 16.15 per cent to USD 20.87 billion in 2020 from USD 17.9 billion in the previous year on account of healthy growth in the shipments of ores, iron and steel, aluminum and copper, according to the data of the commerce ministry. Trade deficit with China has declined 19.39 per cent from USD 56.95 billion in 2019 to USD 45.91 billion in 2020 as the country's imports from the neighbouring country contracted 10.87 per cent to USD 66.78 billion from USD 74.92 billion in 2019, the data showed.


FINANCE

Banks, NBFCs or maybe fintech’s. Who is in a better position to plug the $240 billion credit gap for MSMEs

For 65 million Indian MSMEs that contribute over 45% of the nation’s manufacturing output, a lack of timely and adequate access to funding remains their Achilles’ heel. A report by an IFC-Intellecap in 2019 on unmet credit gap had pegged it at around a massive $240 billion (about Rs 17.40 lakh crore).


OTHER NEWS

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