Despite major export markets like US and Europe showing only fragile recovery, India's exports recorded a jump of 45.7% in the first quarter of the current fiscal. In June alone, merchandise exports shot up 46.4% on an year-on-year basis, aggregating to $29.2 billion.

“Exports are steady. They are growing satisfactorily,” commerce and industry minister Anand Sharma said.

However, uncertainties still persist as the global economies are yet to pick up. Even as most of the sectors including petroleum products, readymade garments, engineering or pharmaceuticals posted robust growth numbers, commerce secretary Rahul Khullar sounded caution: “news from the largest two markets, the US and Europe is far from cheerful...Summer is not over.It is still not going to be easy.”

Interestingly, both US and Europe are India's biggest export markets together accounting for about 35% of the country's total export sales. In the previous fiscal, the markets in combination contributed $246 billion to the overall exports.

Sharma said that he is looking at annual rate of 25% growth so that the exports can reach $500 billion target by 2013-14.

Meanwhile, imports also shot up by 42.4% in June alone to $36.9 billion, thanks to a huge jump in petroleum imports bill. The imports for April- June increased by 36.2% to $110.6 billion.

The trade deficit showed some signs of moderation as it reduced to $7.7 billion in June from $14.9 billion in May. For the period April-June, it stood at $31.6 billion. “Higher imports growth reflects that industry is using imports to fulfil domestic demand,” Ficci secretary general Rajiv Kumar said.

Expressing similar sentiments, Anis Chakravarty director Deloitte Haskins& Sells said, “The export sector has done increasingly well in the first quarter of the current fiscal. There is a perceivable shift in the export mix from traditional to high end services such as engineering for which there seems to be a sustained overseas demand. Recent improvements in the global economy and India’s diversification into new strategic regions such as Latin America and Africa are also bearing fruit. There is also considerable focus by the commerce ministry on doubling exports by FY14 based on a robust export promotion strategy. Overall, this bears well for the external sector. However, the trade deficit continues to remain a concern in light of high imports affected by volatile commodity prices.”

On the other hand, apex exporters body FIEO did voice some concern, saying, that the high growth trend of exports is unlikely during third and fourth quarters, owing to inflation and high interest rates.

“The hike of 0.25% interest rates by SBI will increase the cost of export finance. It will very badly go against exports that will get reflected in October data,”