India's commercial services exports grew by six per cent in the first quarter of 2012, down sharply from 27 per cent in the year-ago period, the World Trade Organisation (WTO) and UNCTAD have said in a report.
However, this was much better than the worldwide commercial services exports growth rate of 3 per cent in the the quarter ended March 31, 2012, found the preliminary estimates for the period by the WTO and UNCTAD (United Nations Conference for Trade and Development).
According to experts, the growth rate declined largely because of global economic slowdown and the country needs to focus on increasing its global competitiveness in the commercial services exports, which mostly includes software services in case of India.
In the previous quarter, October-December 2011, India's commercial services exports had declined by five per cent, but managed to return to positive trajectory in Q1 of 2012.
"Economic slump in the US and Europe is the main reason for this low growth. The other reason include countries like China and Philippines are emerging as stronger players in the services sector," Rakesh Joshi, an international trade expert with India's prestigious Indian Institute of Foreign Trade (IIFT) said.
Joshi said that without enhancing the country's competitiveness in the global market "we will have more problems both in goods and services exports".
India's commercial services imports grew by five per cent in the first quarter of 2012, down from 14 per cent in the year-ago period, the report said.
According to the RBI data, the country's services exports declined marginally by 3.3 per cent to USD 22.54 billion in the first two months of this fiscal.
The services exports during April-May 2011 were at USD 23.3 billion.
Export earnings were also affected as the information technology companies, which accounts for a major chunk in the services export, had to offer discounts to their clients due to rupee depreciation, an expert said.
The rupee has fallen by around 20 per cent against the US dollar from a year ago.
Software, business and financial services, communication services, travel, transportation, insurance are some of the major services that are exported.