India’s goods trade deficit widened to $24.16 billion in August, its highest level in 10 months, as imports surged due to festive shopping in India.
On a month-on-month basis, the trade deficit increased by nearly 17%, compared to the difference between exports and imports of goods of $20.67 billion in July.
India’s imports hit an eight-month high, importing $58.6 billion worth of goods in August. However, the import value has decreased from $61.88 billion in August last year.
“The upcoming Christmas season will probably lead to a significant increase in gold imports,” Commerce Minister Sunil Bhardwal told reporters while releasing the data. Total gold imports in August were $4.9 billion, up from $3.5 billion in August last year. Exports rise to three-month high
Exports fell 6.8% year-on-year, but rose to $34.48 billion in August, the highest level in three months.
“Until July there was pessimism, but now it is giving way to optimism. The green numbers are surging as the export order book looks to be getting better. According to the WTO, global trade The outlook is also improving.” “The green shoots should continue as long as the recessionary trend in the EU does not strengthen,” Bartwal added.
New Delhi is optimistic that exports will further increase in the coming months, confident based on the growth outlook for FY24. “The growth outlook for FY23 was 1.7 per cent, which has been reduced to 2.4 per cent in FY24. This should lead to improvement in exports in the coming months,” Bhardwal said.
However, the decrease in exports compared to the previous year is due to the drop in oil prices. “Almost half of the decline in exports so far this year has been due to lower oil prices. “Export volumes of petroleum products increased by 6%, but prices fell by 27% compared to a year ago,” trade officials said.
Furthermore, the slowdown in developed economies caused gem and jewelry exports to be the main cause of the decline. The sector’s exports fell by $4.4 billion between April and August this year.
Positive signals from mechanical engineering products
Shipments of technology products recorded an increase of 7.73%, and electronic products he increased by 26.29%.
Exports of engineering products continued to decline year-on-year for eight consecutive months, but then turned positive, with total shipments increasing by 7.73% last month. According to the Ministry of International Trade and Industry, the export value of engineering products was $9.05 billion in August 2023, compared to $8.4 billion in August 2022.
The sector accounts for a whopping 25 per cent of India’s export basket, and the country continues to hope for an overall pick-up due to increased sectoral exports.
