With reference to India’s merchandise exports in February 2023, which of the following statements is/are correct?

Question

1. The decline in exports was due to a sharp collapse in oil exports and chemical shipments.
2. Engineering goods outflows accounted for almost half of India’s merchandise exports in February.
3. The immediate outlook for exports is positive, despite the decline in February.
4. The decline in exports was caused by a decrease in domestic demand.

 

(a) Only statement 1 is correct

(b) Statements 1 and 2 are correct

(c) Statements 1, 2, and 3 are correct

(d) Only statement 4 is correct

Answer 1

Answer: (b) Statements 1 and 2 are correct.

 

Explanation: India’s goods exports fell in February 2023, with a sharp decline in oil exports, chemical shipments, and engineering goods outflows. These three categories accounted for almost half of India’s merchandise exports in February. The immediate outlook for exports is not positive, and there are concerns that slipping shipments could result in factory job losses and dent consumption. The decline in exports was not caused by a decrease in domestic demand, as evidenced by the fact that imports also fell sharply in February.