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Despite tough economic conditions, Europe marginally boosted India’s merchandise exports in calendar year 2023, even as overall shipments from the country contracted.
Exports to Europe, which consists of 27 European Union (EU) countries, four European Free Trade Association (EFTA) countries, and seven other countries, increased by 2% year-on-year to $98 billion in 2023. For the year, there was a contraction of 4.8%.
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This increase, albeit small, came despite the region experiencing a near-recession and recording weak economic growth.
“Indian exporters should not hesitate to export goods to Europe, which is India’s largest export market regionally,” a government official told Business Standard.
Exports to the EU in 2023 increased by 2.05% from the previous year to $75.18 billion, and exports to EFTA increased by 2.8% to $1.88 billion.
The growth in exports to the following countries was strong: the United Kingdom (10.72 percent), Switzerland (3.09 percent), the Netherlands (24.57 percent), Romania (116.85 percent), the Czech Republic (25.51 percent), Austria (4.43 percent), Hungary (0.43%), Norway (1.87%), etc.
The jump in the case of the Netherlands was the sharpest. Exports rose by a quarter to $23.11 billion. The UK also saw an increase of almost 11% to $12.42 billion.
Ajay Sahay, Director General (DG) and CEO of the Federation of Indian Export Organizations (FIEO), said one of the reasons driving growth was continued free trade agreement (FTA) negotiations with the EU. He said that this is what he is doing. England.
“Due to FTA negotiations, exporters are focusing on the EU and UK markets. Anticipating the UK FTA, exporters have started building trade relationships with companies from these countries and have also started exporting. In 2023, we were able to increase oil exports to Europe, otherwise many economies would go into recession. Considering that, the growth is encouraging,” Sahay said. Ta.
However, India’s large markets within the EU, such as Belgium, France, Germany and Spain, are shrinking, indicating that growth is uneven.
This contraction can be attributed to the overall trend in most developed countries of slowing demand due to inflation, driven primarily by high interest rates.
Exports to Belgium decreased by 18.13% to $7.97 billion, and exports to Germany decreased by 7.58% to $9.67 billion. In the case of France, the decline was 10.8% to $7.12 billion, while exports to Spain shrank by 3.88% to $4.62 billion.
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