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India's export slump slows in October

The slump in India's merchandise exports eased to a 6.6 percent pace in October, the Commerce Ministry said Tuesday, marking the country's 13th month of declining exports.
/ Source: The Associated Press

The slump in India's merchandise exports eased to a 6.6 percent pace in October, the Commerce Ministry said Tuesday, marking the country's 13th month of declining exports.

Previous months have seen declines of about 30 percent and October's data is the slowest decline since December 2008, fueling hope that export growth momentum will help solidify India's economic rebound.

Merchandise exports were valued at 616.4 billion rupees ($13.2 billion), down 6.6 percent in dollar terms from the $14.1 billion recorded during October 2008.

Imports fell 15 percent in dollar terms, to 1.0 trillion rupees ($22.0 billion) from a year ago.

India's trade deficit for April through October was $57.3 billion, down from $87.8 billion during the same months last year.

Goldman Sachs said in a report Tuesday that it expects exports to return to positive growth in January.

Growth in manufacturing activity slipped from October to November to its weakest level since March, due to slowdowns in both new orders and output, the HSBC Markit Purchasing Managers' Index showed Tuesday.

"This is disappointing and fits with the notion that the best of India's industrial recovery is already behind us," said senior HSBC economist Robert Prior-Wandesforde in a research note.

That puts more pressure on India's services sector to drive economic growth going forward.

India's economy grew by 7.9 percent last quarter, much faster than expected, but economists worry growth will slow as the impact of widespread drought hits agricultural output in coming months.