India’s exports grew 17.57 per cent to $27.7 billion in June on account of healthy growth in sectors such as petroleum and chemicals but trade deficit widened to a 43-month high of $16.6 billion due to costlier crude oil imports. Imports rose 21.31 per cent to $44.3 billion during the month, according to the data released by the commerce ministry.
The trade deficit in June 2018 is the highest since November 2014 when the gap was $16.86 billion. The deficit in June 2017 stood at $12.96 billion. During April-June this fiscal, exports rose 14.21 per cent to $82.47 billion. Exports of petroleum products, chemicals, pharmaceuticals, gems and jewellery, and engineering goods registered a positive growth.
However, shipments of textiles, leather, marine products, poultry, cashew, rice and coffee recorded negative growth. Federation of Indian Export Organisations (FIEO President Ganesh Gupta expressed concern over rising trade deficit, saying it could impact current account deficit thereby adding to the woes of the government on the fiscal deficit front.
“MSME sectors of exports are still feeling the pinch of liquidity crunch as banks and lending agencies have continuously been tightening their lending norms,” he said in a statement. Imports during the first quarter of the fiscal increased 13.49 per cent to $127.41 billion. Trade deficit during the period widened to $44.94 billion as against $40 billion in April-June 2017.
Oil imports during the month were up 56.61 per cent to $12.73 billion. These imports during April- June 2018-19 were valued at $34.64 billion, which was 49.44 per cent higher as compared to the same period last year. Gold imports in June dipped about 3 per cent to $2.38 billion. Meanwhile, the Reserve Bank data showed that services exports in May contracted 7.91 per cent to $16.17 billion. The trade balance in services (i.e. net export of services) for May was estimated at $5.97 billion. The imports stood at $10.21 billion.