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Exports: During 2014–15 and 2015–16 India’s exports had declined by 1.3 per cent and 15.5 per cent, respectively. The trend of negative growth was reversed somewhat during 2016–17 with exports registering a growth of 0.7 per cent (US$ 198.8 billion). A large number of export sectors have moved to positive zone during this period:
Imports: Imports did show mixed trend with decline being the chief feature
—value of imports declined from US$ 448 billion in 2014–15 to US$ 381 billion in 2015–16, mainly on account of decline in crude oil prices resulting in lower levels of POL (petroleum, oil and lubricants) imports. The trend continued in 2016–17 also with imports declining by 7.4 per cent to US$
275.4 billion. Top three import destinations of India were China followed by UAE and USA.
Trade deficit: India’s trade deficit has been declining since the last two years—by 13.8 per cent in 2015–16 and 23.5 per cent during 2016–17 (falling to around US$ 100 billion)—current account deficit (CAD) being comfortable at 0.3 per cent by the first half of the fiscal 2016–17.
FDI: FDI (foreign direct investment) inflows increased by 29 per cent ($ 21.3 billion) during the first half of 2016–17 relative to 2015–16. The inflows have shown accelerating growth—in the second half of 2016–17 it reached
3.2 per cent of GDP from 1.7 per cent of GDP of the same period of the preceding year.
Exchange rate: Rupee depreciated during 2016–17 (April-December) caused largely by strengthening of the US dollar globally and tightening of monetary policy there. However, it has performed better than the currencies of most of other emerging market economies (EMEs). On year-on-year basis, the rupee depreciated by 3.4 per cent against US dollar as compared to the depreciation of Mexican peso (14.4 per cent), South African Rand (8.6 per cent) and
Chinese renminbi (6.3 per cent).
Forex reserves: Forex reserves were at comfortable levels of US$ 360 billion (December 2016)—with a rise of US$ 10 billion since January 2016.
External debt: External debt was at US$ 484.3 billion (September 2016), recording a decline of US$ 0.8 billion over the level at end-March 2016— mainly due to reduction in commercial borrowings (i.e., ECBs) and short- term debt—having the following features. Cross-country comparison (as per the World Bank’s International Debt Statistics 2017), indicates India to be among the less vulnerable indebted countries among the developing world.