The country made shipment worth $ 2.69 billion in May 1999 against $ 2.41 billion in the corresponding period last year, official sources said. Cumulative exports in the first two months of the current fiscal stood at 6.09 per cent.

This is the second time this calendar year that a double digit export growth rate had been posted on a month-on-month basis. In March, a 10.07 per cent export growth rate was recorded. But in April 1999, the growth rate slid to 2.09 per cent compared to same period the previous fiscal.

Imports grew by 1.64 per cent in may 1999 at $ 3.55 billion against $ 3.49 billion in the corresponding period last year. Sources said this signified a continued downtrend in the country's economic fortune particularly because machine tool and capital goods imports had dipped.

Tradedeficit in the first two months of the fiscal widened to $ 1.37 billion despite the low import growth rate, sources said. They said imports did not witness any significant rise despite increase in crude oil prices.

Moreover, gold and silver imports into the country had also slid during the period. While machine tool imports had declined, on the other hand its exports had also slid causing some concern, they said.

Commodities like gem and jewellery and cotton yarn have begun showing positive trend in exports, accounting for the good show in April and May. Exports during 1998-99 increased by 3.7 per cent mainly due to the excellent turnaround in growth rate since November.

During the first half of 1998-99, exports had witnessed a downtrend mainly in view of the recession in South-East Asia and other parts of the world. For the current fiscal, government has set a 11 per cent target. Commerce minister Ramakrishna Hegde expressed hopes that the target can be achieved. However, Hegde said in Vishakapatnamyesterday that exports could be affected if the Kargil situation prolongs beyond August.