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Dated: 23.02.2025

DGFT Issues Policy Circular on Export Decline: Key Sectors Affected in 2023-24

The Directorate General of Foreign Trade (DGFT) issued Policy Circular No. 11 (2024-25) on January 21, 2025, analyzing India’s export performance in FY 2023-24. The circular highlights product groups that experienced a decline of more than 5% in exports compared to FY 2022-23.

Key Findings:

• Major export declines were observed across agriculture, seafood, processed food, textiles, chemicals, metals, minerals, and engineering goods.
• Top declining exports include:
  • Agriculture: Wheat (-96.27%), Maize (-60.28%), Soya Beans (-86.38%), and Natural Honey (-12.51%).
  • Seafood: Frozen Fish Fillets (-15.69%), Crustaceans (-10.64%), and Mollusks (-14.77%).
  • Textiles: Woven Cotton Fabrics (-6.99%), Synthetic Staple Fibers (-23.67%), and Garments (-11.90%).
  • Metals & Minerals: Ferro-Alloys (-15.15%), Stainless Steel (-47.66%), and Aluminum Ores (-51.21%).
  • Petroleum & Chemicals: Petroleum Oils (-13.63%), Organic Compounds (-6.06%), and Biodiesel (-76.65%).

Causes of Export Decline:

• Agricultural Restrictions: Government-imposed bans on wheat and other food grains.
• Global Demand Slowdown: Lower international demand for textiles, seafood, and metals.
• Price Volatility: Fluctuations in global prices for petroleum and chemicals.
• Trade Barriers: Import restrictions by key markets like the EU and the USA.

Government’s Possible Interventions:

• Policy Reforms: Reviewing export restrictions and providing incentives like RoDTEP.
• Industry Support: Financial assistance for exporters and diversification of markets.
• Logistics Enhancement: Strengthening port infrastructure and streamlining customs clearance.

Conclusion: The DGFT’s Policy Circular highlights significant challenges in India’s export sector, requiring urgent policy interventions to regain trade momentum. The government and exporters must collaborate to develop resilient strategies and ensure India’s global trade competitiveness.

Para 5.17(a) of HBP : To provide relief to exporters of those sectors where total exports in that sector/product group has declined by more than 5% as compared to the previous year, average export obligation for the year may be reduced proportionate to reduction in exports of that particular sector/product group during the relevant year as against the preceding year. However, in case export decline is continuous over consecutive years, the base year for calculation of eligibility and calculation of reduction in average export obligation will be taken as the year after which the exports have shown continuous decline.

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Source: DGFT

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