Domestic bank export financing fell in the first ten months of fiscal 2023 as demand for Indian goods fell amid a global slowdown and uncertainty over the Russia-Ukraine war.

According to the most recent Reserve Bank of India (RBI) data, the growth in export financing fell by 39.2 percent to Rs 14,390 crore on January 27, 2023, from Rs 23,681 crore on March 25, 2022. The decrease is 41.4 percent year on year. Export financing fell by 28% between April and October 2022. During April-January 2022-23, the country’s merchandise exports increased by 8.51 percent to $369.25 billion, up from $340.28 billion in April-January 2021-22. The year-on-year increase in merchandise exports from April to January 2021-22 was 46.73 percent. percent in 2020-21. However, exports fell 6.58 percent in January 2023.

According to the Economic Survey 2022-23, global economic growth and trade have begun to slow as a result of aggressive and coordinated monetary tightening. According to the United Nations Conference on Trade and Development’s (UNCTAD) most recent global trade update, global trade growth will turn negative in the second half of 2022.

Geopolitical tensions, persistent inflationary pressures, and subdued demand are expected to further stifle global trade in 2023. According to the survey, this is likely to affect many countries, including India, with the prospects of sluggish exports continuing into FY24, compared to the promise shown at the start of the current year.

“The hikes in Interest rates set by the majority of central banks around the world have reduced people’s purchasing power. Consumers around the world are deferring purchases, resulting in a drop in demand for (Indian) goods, according to another banker.