New Delhi: The bilateral trade between India and Turkey increased 41 per cent in April-November 2022 year-on-year, driven primarily by higher imports of petroleum crude, data from the Ministry of Commerce shows.
This is contrary to the trend seen in the last two years, where India’s exports to Turkey were driving the trade between the two countries.
An analysis of data from the ministry by ThePrint shows that merchandise trade between India and Turkey grew significantly in FY23, rising to $9.12 billion in April-November 2022 from $6.44 billion in the same period in 2021.
Indian exports grew 20 per cent, touching $6.18 billion from $5.12 billion during the same period in 2021, a breakup of the trade growth from April-November 2022 shows. Turkish imports grew to $2.94 billion from $1.33 billion — a whopping 120 per cent, data shows.
This means imports added $550 million more to the total bilateral goods trade than exports.
In contrast, the trade growth between FY 2019-2020 and FY 2021-22 tells a different story.
According to the government’s data, India-Turkey bilateral goods trade grew to $10.71 billion in FY22 from $7.08 billion in FY20 — a 51 per cent rise over pre-pandemic levels. However, a breakup shows that Indian exports grew 75 per cent while imports of Turkish goods fell 5 per cent over pre-pandemic levels.
According to Federation of Indian Export Organisations (FIEO) director general Ajay Sahai, there could be two reasons behind the spike in imports from Turkey in the first eight months of the current financial year.
“It’s possible that some Russian goods like petroleum crude are being rerouted through Turkey and that it could also be that the depreciating lira has made Turkey’s exports more competitive,” Sahai told ThePrint.
The Turkish lira fell approximately 30 per cent last year, as its central bank slashed interest rates despite rising inflation. Usually, a devalued currency can make exports more competitive because goods and services will cost less in the international market.
The growth in India-Turkey bilateral trade over the past three years hasn’t gone unnoticed. Last week, Turkey’s Deputy Minister of Trade Rıza Tuna Turagay said at a Republic Day event hosted by the Indian embassy in Turkey that trade between the two countries could be the “fastest in terms of growth in recent years”.
The development comes amid a deepening energy crisis in Europe amid the crude oil shortage, an ongoing war, and rising inflation.
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Growth of Turkish imports
According to data from India’s commerce ministry, petroleum crude was the top imported item from Turkey in the first eight months of the current fiscal, standing at 1.37 billion kgs, or 10.07 million barrels (assuming 1 barrel is 136 kg).
India imported an average of 140 million kg or 1.02 million barrels of crude from Turkey every month from April-November 2022, except June when it rose to a whopping 540 million kg or 3.9 million barrels.
This is over and above India’s crude oil imports from Russia, which hit one million barrels per day in December 2022 for the first time ever.
Apart from petroleum crude, imports of Turkish marble and travertine grew 54 per cent in April-November 2022 year-over-year from 365 million kg to 563 million kg in the same period last year.
Imports of apples also grew nearly 50 per cent in the current fiscal.
Major Indian exports to Turkey in the first eight months of this fiscal included automotive diesel fuel, precious stones, yarn, and medical equipment like cannulae, according to the data.
Trends in trade from FY20-22
The last two fiscals of 2020-2021 & 2021-2022 saw India’s exports to Turkey perform better than imports.
Data from the commerce ministry show exports rose to $8.71 billion in FY22 from $4.96 billion in FY20 — a 75 per cent increase.
The major Indian exports over the last three years include mineral fuels, raw aluminium as well as iron and steel, according to sources in the Turkish embassy in New Delhi.
Meanwhile, imports of Turkish goods from FY20 to FY22 fell from $2.11 billion to $1.99 billion — a 5 per cent decline. In FY20, marble and material substances like anhydrous ammonia (used in nitrogen fertiliser) were the top imported commodities. However, in FY21 and FY22, imported petroleum oils and crude climbed to the top of that list.
From being 82nd in the list of imported commodity from Turkey in FY21, petroleum oils and crude became the most imported commodity in FY22, growing from 1 million kg to 880 million kg.
(Edited by Uttara Ramaswamy)
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