Trade Deficit Narrows To $19.8 Billion In December
The trade gap narrowed to $19.8 billion in December, as compared with $20.6 billion in November.
India's trade deficit narrowed in December as exports and imports rose during the month.
The trade gap narrowed to $19.8 billion in December, as compared with $20.6 billion in November, according to data from the Ministry of Commerce and Industry.
Key Highlights
Exports rose by 1% to $38.45 billion.
Imports fell by 4.9% to $58.25 billion.
Exports rose by 13.4%, on a month-on-month basis.
Imports rose by 6.9%, on a month-on-month basis.
India’s merchandise trade deficit was lower than expectations, owing to a better-than-expected performance of exports in the month, Aditi Nayar, chief economist at ICRA said.
"Given this, we expect the CAD to print at about $16-18 billion in Q3 FY24, lower than our earlier estimate of over $20 billion, albeit nearly twice the reading seen in Q2 FY24."
Key Export Items
Exports of engineering goods stood at $7.9 billion, 3.1% lower year-on-year.
Petroleum product exports were at $7.5 billion, 7.5% lower than a year earlier.
Gems and jewellery exports were at $2.8 billion, 12% lower on an annual basis.
Organic and inorganic chemical exports were at $2 billion, 11.4% lower on an annual basis.
Drugs and pharmaceutical exports were at $2.1 billion, 7.3% higher from over a year earlier.
Key Import Items
Petroleum, crude, and product imports were down 8.5% from a year ago at $14.9 billion.
Organic and inorganic chemical imports were at $2.2 billion, 16.5% lower on an annual basis.
Imports of coal, coke, and briquettes were down 10.4% than a year ago at $3.4 billion.
Imports of electronic goods were at $6.5 billion, 10.1% higher over a year earlier.
Machinery, electrical and non-electrical goods were at $4 billion, up 3.4% over the previous year.
Gold imports stood at $3.5 billion, 6.2% higher than a year ago.
Services exports fell to $27.88 billion in December 2023, from $31.19 billion a year ago, while imports declined to $13.3 billion, from $61.22 billion in the same period.
India recorded a major decline in the trade deficit as merchandise exports grew, said Commerce Secretary Sunil Barthwal. There are still adverse conditions that the globe is facing, but India is doing well as compared with global trends, he said. "India is beating global trends, and we hope this continues in the last quarter."
In terms of the geopolitical conflict in the Red Sea, while the government will take stock of the situation, an impact is likely, Barthwal said.
