Trade deficit climbs to 10-month high in Aug, exports down 6.86%

New Delhi: Merchandise exports declined for the seventh consecutive month in August to $34.48 billion, a fall of 6.86 per cent from the year-ago period mainly due to subdued global demand for petroleum and gems and jewellery sectors.
Data released by the Ministry of Commerce and Industry Friday showed that imports also declined for the ninth month in the row by 5.23 per cent to $58.64 billion, which means that the trade deficit, the gap between exports and imports, stood at $24.16 billion in August, a ten-month high.
Excluding gems and jewellery and petroleum, exports in August were $26 billion compared to $25.02 billion last year. Cumulatively, exports during April-August contracted by 11.9 per cent to $172.95 billion. Imports during the five-month period fell by 12 per cent to $271.83 billion. The trade deficit narrowed to $98.88 billion against $112.85 billion during April-August 2022.
Commerce Secretary Sunil Barthwal said that there have been some green shoots and the situation is stabilising. India’s exports had contracted by 15.88 per cent in July. He added that till July, there was a pessimism, but now green shoots are visible. “It means the global situation is improving. The trade deficit, which has always been a concern, but the figures (August) are looking good. It is a soothing factor for the economy,” Barthwal said. The official, however, expressed concerns over rising interest rates in Europe, which may impact their manufacturing and hence, demand for Indian goods. The secretary also said that firming up prices of crude oil and other commodities would also increase the value of exports.
Exports sectors, which recorded negative growth in August, include tea, coffee, rice, spices, leather, gems and jewellery, textiles, and petroleum products. 15 of the 30 key sectors recorded positive growth in August.
On the import front, oil shipments in August dipped by 23.76 per cent to $13.2 billion. Gold imports in August rose by 38.75 per cent to $4.93 billion. Exports of electronic goods rose by 26.29 per cent in August to $2.17 billion and cumulatively increased by 35.22 per cent during April-August to $11.18 billion.
Services exports in August are estimated at $26.39 billion against $26.5 billion a year ago, while services imports stood at $13.86 billion against $15.22 billion.

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