The impressive export performance of 34.92 per cent in December 2002 is partly because of the low base in December 2001.

The statistical aberration means the steep hike should be viewed with caution.

While the government is of the view that the $49 billion export target for the year can be met if the growth momentum is maintained, such steep growth rates may not be possible in the coming months.

Commerce ministry officials said the exports growth for the financial year is expected to be over 12 per cent.

Exports in December 2002 were valued at Rs 21,031.49 crore (Rs 210.314 billion), and in value terms, it was an above average performance as compared to the other months in 2002-03.

However, December 2001 was a bad month for exports.

Hit by the slowdown in the world economy and also the decline in exports to the United States on account of the terrorist attacks, the value of exports in the month was only Rs 15,574.31 crore (Rs 155.743 billion), one of the worst monthly export performances in the April-December 2001-02 period.

The year-on-year growth in December 2001 was in fact negative.

Subir Gokarn, chief economist, Crisil, said the higher export growth in December was on account of a spurt in demand from the European Union.

Exports have done well so far, because consumer spending in the US has remained steady and the Indian Rupee has depreciated against other currencies.

However, he adds: "Export buoyancy may not persist because the depreciation of the Indian Rupee against competing currencies is expected to start tapering off."

The other factor responsible for the steep rise in export values has been the upturn in prices. For instance, the global steel price, which is currently $310 per tonne has seen a sharp increase compared to the previous financial year.

The price of HR around February 2001-02 was about $200 per tonne. Also, international paper prices which are presently estimated at $620 per tonne, which is about $40 higher than what it was in February 2001-02.

Other than this, in several segments, exporters have managed to diversify their markets and thereby increase the volume of exports.

An example is the paper industry, where the addition of new markets like Sri Lanka and Bangladesh has led to an increase in sector's total exports.

Exports which stood at about 170,000 tonnes in the last financial year, are expected to touch 250,000 tonnes in 2002-03 according to the Indian Paper Manufacturers' Association.

The export performance is commendable, particularly since several other countries in the South Asian region like Malaysia, Thailand and Indonesia had recorded negative growth during this period.