By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Sign In
BusinessLogrBusinessLogr
Aa
  • Home Beauty
  • Stocks
  • Finance
  • Business
  • Company
  • Economy
  • Industry
  • Investing
  • Car News
  • Contact Us!
Reading: Diversification to Asia now weighs on India’s exports
Share
BusinessLogrBusinessLogr
Aa
Search
  • Home Beauty
  • Stocks
  • Finance
  • Business
  • Company
  • Economy
  • Industry
  • Investing
  • Car News
  • Contact Us!
Have an existing account? Sign In
Follow US
© 2022 Foxiz News Network. Ruby Design Company. All Rights Reserved.
BusinessLogr > Industry > Diversification to Asia now weighs on India’s exports
Industry

Diversification to Asia now weighs on India’s exports

deep
Last updated: 2015/12/24 at 11:56 AM
deep Published December 24, 2015
Share
3 Min Read
SHARE

The biggest contributors to the slowdown in India’s exports have been the UAE, China, Hong Kong, Singapore and Japan—most of these countries have seen exports contract in the double digits.

India’s export growth has been contracting, given the slowdown in the global economy. Exports have fallen around 17.6% since the beginning of fiscal 2016 after declining marginally in fiscal 2015.

What is worrying is that exports to Asia are also declining. In the past few years, India diversified its exports towards the Asian markets, especially after the financial crisis hit North America 2008-09.

Asia accounts for around half of India’s total exports so far in 2015-16, which is more than the combined share of Europe and the US at 31.8%.

Click here for enlarge

Asia is leading the fall in export growth following Africa in FY16, down 19%, compared with a marginal decline seen in the previous fiscal year, according to data compiled by Crisil Research.

Slowing exports to Asia are a reflection of lower commodity prices and feeble demand for goods in China. “Commodity price corrections reflect subdued demand globally, particularly in China. China’s exports have taken a significant hit and the Asian markets, which are directly or indirectly linked to China, have seen a demand slowdown. The softening growth rates have meant lower imports, which, in turn, have affected the exports of Indian products to the Asian markets,” said Rakesh Valecha, senior director and head of corporate ratings from India Ratings and Research Pvt. Ltd.

The biggest contributors to the slowdown in India’s exports have been the UAE, China, Hong Kong, Singapore and Japan—most of these countries have seen exports contract in the double digits. The waning exports may actually derail the recovery process. With exports getting affected, coupled with the improving but still subdued domestic demand, capacity utilization levels for key sectors will take time to improve, which, in turn, will delay the process of recovery for Indian companies, according to Valecha.

Smaller companies that have a problem of liquidity and leverage may take a bigger hit from slowing Asian exports.

The contribution of MSMEs (micro, small and medium enterprises) to Indian exports has been growing—their share of the total exports increased to 44.7% in FY15 from 43% in FY13, according to Crisil Research.

This means that although there will be a modest improvement in domestic demand, the credit profile of companies is unlikely to change materially. As a result of the deflationary impact of the lower commodity prices, nominal income growth of companies in most of the exporting sectors is likely to remain depressed.

Additionally, any adverse impact of an expected interest rate hike in the US on trade partner economies also remains a risk, according to India Ratings and Research in a note dated 9 November.

[“source -financialexpress”]

You Might Also Like

FedEx Office Expands Same Day Delivery to 1,800 American Cities

What is Visme and How Do I Use It for Business?

Link Building Lessons from the Real Estate Industry

Shamita Shetty: None of my best friends are from the film industry

Google Web Designer HTML5 Tool is Updated

TAGGED: Diversification to Asia now weighs on India’s exports

Sign Up For Daily Newsletter

Be keep up! Get the latest breaking news delivered straight to your inbox.
[mc4wp_form]
By signing up, you agree to our Terms of Use and acknowledge the data practices in our Privacy Policy. You may unsubscribe at any time.
deep December 24, 2015
Share this Article
Facebook Twitter Email Print
Share
Previous Article Nitish Kumar bans liquor in Bihar from Apr 1, keeps poll promise
Next Article Relaxation of FDI norms ‘absolute jugglery’ of words: CAIT

Most Viewed Posts

  • 20 Fitness Franchises: Planet Fitness and Beyond
  • Choosing the Right Legal Structure For Your Business
  • bmo harris express loan payment
  • payday loans that work with chime bank
  • find a loan shark on craigslist

Most Viewed Posts

  • 20 Fitness Franchises: Planet Fitness and Beyond
  • Choosing the Right Legal Structure For Your Business
  • bmo harris express loan payment
  • payday loans that work with chime bank
  • find a loan shark on craigslist

Recent Posts

  • The Essence of Public Storage Units
  • Guide to Retirement Planning: Putting Money Into the Future

FOXIZ

© 2022 Foxiz News Network. Ruby Design Company. All Rights Reserved.

Join Us!

Subscribe to our newsletter and never miss our latest news, podcasts etc..

[mc4wp_form]
Zero spam, Unsubscribe at any time.

Removed from reading list

Undo
Welcome Back!

Sign in to your account

Lost your password?