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Charts & Analysis

Indian Exports Contract for First Time in Seven Months in Oct 2014

Export data for October 2014 shows a stunning drop in goods exports by 5% this month. This is the first time we’ve contracted in terms of exports, year or year (both dollar and rupee terms) in seven months.

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The only saving grace: Our trade deficit wasn’t as wide as it was last month. It still is among the highest since May 2013 (second highest month, in fact)

What happened to our exports?

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This is totally going awry now. We have a new, stable government. We have much lower oil costs now that crude has fallen about 20%. And indeed, oil imports fell 17%. But we’re still hitting non oil imports at +19%!

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It could be that we are seeing a lot more gold imports (It’s gone 4x to $4 billion says Reuters) and we might see more Gold import curbs going forward. But Gold can’t be all of it – there’s obviously a lot more.

Look, this is a bull market. So stock prices will go up regardless of bad data.

But this data is strange because we all get the impression everything’s hunky dory and the next five years are definitely the best for India. Apparently, the exporters haven’t been able to catch up.

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