Informist, Tuesday, Sep 17, 2024

--Govt: India Aug edible oil imports $1.57 bln

--Govt: India Aug petroleum imports $11.01 bln

--Govt: India Aug gold imports $10.06 bln

--India Aug non-oil exports at $28.76 bln vs $28.74 bln yr ago

--India Aug non-oil imports at $53.34 bln vs $46.01 bln yr ago

--India Aug imports at all-time high of $64.36 bln

--India Aug trade deficit $29.65 bln vs $24.02 bln year ago

--India Aug imports $64.36 bln vs $62.30 bln yr ago

--India Aug exports $34.71 bln vs $38.28 bln yr ago

--Govt: India Apr-Aug gold imports $22.7 bln, up 25.1% on year

--Trade secy: Rice exports fell in Apr-Aug due to govt curbs

--India Apr-Aug trade deficit $116.64 bln vs $99.16 bln year ago

--India Apr-Aug imports $295.32 bln vs $275.83 bln yr ago

--India Apr-Aug exports $178.68 bln vs $176.67 bln yr ago

--Trade secy: Trade deficit not a matter of concern

--Trade secy: Rice exports fell in Apr-Aug due to govt curbs

--Trade secy: Aim to achieve $200 bln e-commerce exports in 5 years

--Trade secy: Working on a pilot project for e-commerce export hub

--Trade secy: Huge slowdown in China impacting petroleum prices

--Trade secy: Longer trade route via Cape of Good Hope a challenge

--Trade secy: Exports a huge challenge in current global scenario

NEW DELHI – India's merchandise trade deficit rose sharply to $29.65 bln in August from $24.02 bln a year ago as the import bill hit an all-time high of $64.36 bln in the previous month, data released by the commerce ministry today showed. The trade deficit in August was the highest in 10 months. It was $30.43 bln in October.

In August, the export of goods fell 9.3% on year to $34.71 bln after contracting by 1.5% on year to $33.98 bln in July. Imports, on the other hand, increased 3.3% on year in August.

The record-high import bill was due to huge consumption demand in the economy which is growing at a much higher rate than other countries, Commerce Secretary Sunil Barthwal said today. However, the trade deficit is not a matter of concern, Barthwal said while briefing the media on the data for August.

According to the latest GDP data for Apr-Jun released by the National Statistical Office, private consumption expenditure, which is an indicator of consumer confidence, rose 7.4% in the quarter, much higher from the paltry 4% in the preceding quarter.

In Apr-Aug, exports rose only 1.1% on year to $178.68 bln, and imports increased 7.1% to $295.32 bln. The trade deficit for the first five months of 2024-25 (Apr-Mar) was $116.64 bln, up 17.6% on year.

On the tepid growth in exports, Barthwal said there was a huge challenge in the current global scenario. Earlier in the month, Commerce and Industry Minister Piyush Goyal had also said that there were concerns over global trade growth on account of the two ongoing wars. He was referring to the Russia-Ukraine war that started in February 2022 and the conflict in West Asia involving Israel, Palestine, and Iran.

According to the World Trade Organization, global trade contracted 1.2% in 2023 due to geopolitical conflicts. For this year, the WTO has projected a rebound in global trade, saying it is expected to grow by 2.6%.

Besides the impact of the ongoing conflicts, Barthwal said that longer trade routes through the Cape of Good Hope, an alternate route to the Red Sea, is a challenge for India. Attacks by Yemen-based Houthi militants in late 2023 led to disruption in shipments through the Red Sea and prompted many commercial vessel operators to seek alternatives to the Bab el-Mandeb Strait and the Red Sea, the waterways off Yemen's coast.

Rice was one of the key export commodities from India that used the Red Sea route--the shortest route for ships moving from Asia to Europe. Besides the likely impact of longer trade route, rice exports in Apr-Aug were further impacted by the government's curbs, Barthwal said. The government recently lifted restrictions and scrapped the minimum export price on basmati rice which will give a boost to exports and lead to a fall in domestic stocks.

To boost exports, Barthwal also said that the government was working on a pilot project for e-commerce export hubs. This was initially part of the government's 100-day agenda. Through these hubs, small producers will be facilitated to sell to aggregators, who will then find markets and sell to consumers or other businesses outside India, Barthwal had earlier said.

The government aims to achieve $200 bln worth of e-commerce exports in five years, he said.

The record high imports in August was because of all-time high gold imports during the month, which more than doubled to $10.06 bln from $4.94 bln a year ago. This was after the government cut the basic customs duty on the precious metal in the Budget to 6% from 15% in July. Gold imports for the Apr-Aug period were up 25.2% at $22.70 bln. The export of gems and jewellery fell 23.1% to $2.00 bln in August.

India's crude oil imports also fell in August, by 32.4% on-year to $11.02 bln. In line with this, the export of petroleum products declined for the third consecutive month to $5.96 bln in August, down 37.6% from last year.

Non-oil exports grew marginally to $28.76 bln in August from $28.74 bln a year ago. Non-oil imports rose about 16% to $53.34 bln during the month.

Import of electronic goods rose 11.4% on year to $39.48 bln in the first five months of the financial year, while their exports were up 21.8% at $13.57 bln. India exported engineering goods worth $46.41 bln in Apr-Aug, up 4.2%.

The following tables detail trade data for August and Apr-Aug, in bln dollars, and the percentage changes:

Source: Ministry of Commerce and Industry

End

US$1 = 83.75 rupees

Reported by Krity Ambey and Priyasmita Dutta

Edited by Ashish Shirke

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