India’s exports dropped 9.3 percent in August due to the Red Sea crisis, logistical challenges, and disrupted shipping routes.
India’s exports contracted by 9.3 percent in August, driven by logistical challenges and the ongoing Red Sea crisis, according to experts. The disruptions have forced shipping routes to take longer paths around the Horn of Africa and the Cape of Good Hope, making exports to Europe less viable. Global Trade Research Initiative (GTRI) founder Ajay Srivastava linked the 37.56 percent decline in petroleum exports, dropping to $5.95 billion from $9.54 billion in August 2023, to these disruptions.
Despite stable crude oil prices, the Red Sea crisis significantly affected India’s overall merchandise trade. Federation of Indian Export Organisations (FIEO) President Ashwani Kumar added that global uncertainties, lower commodity prices, and logistical challenges like shipping space shortages and irregular schedules also contributed to the export drop. The trade gap widened to $29.65 billion in August, up from $23.5 billion in July.
Kumar called for urgent steps, including deeper interest subvention and an extension of the interest equalisation scheme to support exporters. He also emphasised the importance of extending the RoDTEP scheme, set to expire on September 30, to provide a predictable business environment.
Amidst these challenges, Mithileshwar Thakur, Secretary General of the Apparel Export Promotion Council (AEPC), noted a 7.12 percent growth in apparel exports from April to August, with August showing an 11.88 percent increase, reflecting the resilience of India’s ready-made garments sector. He expressed optimism about continued growth, citing robust order books for the industry.
