India’s trade surplus in agricultural and allied products has slipped to an extent that the import of these products is now almost on par with the export, reports Dilip Kumar Jha on Business-Standard.com. Four years ago, the country enjoyed a trade surplus of almost 150%. That has now narrowed down to a mere 6%, due to a sharp increase in import and fall in exports, following unfavorable government’s policies.
Data compiled by the Directorate General of Commercial Intelligence and Statistics (DGCIS) under the Ministry of Commerce and Industry showed India’s exports of agri and allied products declined by 25% to $24.69 billion for the financial year 2016-17 from $32.95 billion from FY2014. In contrast, overall import of agri and allied products rose during the same period to $23.20 billion from $13.49 billion.
Many meteorological zones in India had two subsequent years of drought since FY2014, which lowered the output of several farm products including some essential items such as pulses, edible oil and sugarcane. Since their consumption continues to increase with a growing population, a weaker dollar in recent times has made these agri products cost effective. In contrast, the government feared lower output in cereals like rice, wheat and maize, resulting in continuation of restrictions on their exports. Both factors acted together to narrow the trade surplus in agri and allied products over the last four years.