Overall exports from the country declined 15 per cent in October, the first time since 2003, preliminary data suggest, RS Gujral, director-general of foreign trade (DGFT), said.
Non-oil exports from the country dropped 20 per cent in October amidst a fall in US and European demand, against a marginal three per cent rise in September, he said.
The US and the European Union account for 35 per cent of India's total exports. The US has a 13 per cent share of Indian exports while the EU accounts for 22 per cent of India's total exports.
Non-oil exports like gems and jewellery, textiles and handicrafts, which account for over 80 per cent of India's export basket, have been the hardest hit.
''Apart from oil products and a couple of small sectors, exports from all other areas dropped in October. The data indicate the difficult times exports are going to face,'' Gujral said.
Exports from the country expanded 31 per cent in the six months from April to September. In the seven months from April to October, exports, however, grew 21.5 per cent against 23.3 per cent in the same period last year.
India's exports stood at $162.9 billion for the whole of last year, but the country may find it difficult to hit this year's target of $200 billion, Gujral said.
India's exports are likely to be further affected in the coming months as the global meltdown unfolds.
''My personal feeling is that lower demand from markets abroad will continue to put pressure on exports,'' Gujral said.
Exports have fallen more due to liquidity problems than a real fall in demand, say analysts. Both overseas buyers and Indian exporters are finding it difficult to access liquidity.
Gujral said while the Reserve Bank of India has taken many steps recently to ease liquidity constraints, in terms of reducing CRR and SLR, the small exporters are not getting the benefit of those measures.
Meanwhile, the government is discussing possible measures to help exporters. ''The measures could be sector-specific,'' Gujral said.
India's exports are now likely to grow at around 19 per cent this year, against the target of over 23 per cent. The government, however, expects some respite in the ballooning import bill as the prices of crude oil have fallen.
The final export figures for October will be released in the first week of December, after revised data from ports are compiled by the commerce ministry.