As the world economy is expected to slowdown, it is estimated to have a greater negative impact on Indian exports, said the Bank of Baroda in a report on Thursday.
The report stated that two key factors impact exports — the value of the rupee and global economic activity.
As per the report, a 1 per cent appreciation in the Indian rupee and USD causes a 0.5 per cent decline in exports, while a one per cent growth in global gross domestic GDP helps boost our exports by 4.5 per cent.
“While a depreciating rupee will be positive for services exports, a slowing global economy is not so good news for us, as it will have a greater impact,” it said.
So far (April to September 2022), services exports have remained resilient and have risen to USD 153 billion (+29.9 per cent) from USD 118 billion (+16.5 per cent) last year and USD 110 billion (+9 per cent) during the pre-pandemic period (FYTD20).
Import bill of services has also gone up, however, the report stated, “We continue to maintain a healthy surplus account, and our services balance has risen 1.6 times in FYTD23 (USD 63 billion), since the pre- pandemic period (FYTD20: USD39 billion).”
Doonited Affiliated: Syndicate News Hunt