India's export drops; trade deficit widens to $14 billion in October

Lloyd Doyle
November 14, 2017

Shipments of textiles, pharmaceuticals, leather and gems and jewellery fell, the data showed. Exports following a growth of 7.89 percent increased to $1.9 billion in October 2017 from $1.8 billion in October 2016 while imports after a growth of 23.6 percent increased to $4.9 billion from $3.98 billion. The trade deficit has widened by more $31 billion in the first seven months of the current financial year to $86.15 billion, which could put pressure on the current account deficit of Asia's third largest economy.

After attaining six-month high growth in September, the trade deficit - difference between exports and imports - widened to $14 billion during the month under review as against $11.13 billion in October 2016.

Imports, however, grew by 7.6 per cent to Dollars 37.11 billion in October from USD 34.5 billion in the year-ago month, the commerce ministry data released today showed. Mr Gupta said that there is immediate need for remedial measures to prevent further decline in exports otherwise the situation may be worse for November, 2017.

He noted that WTO's latest World Trade Outlook Indicator (WTO) also suggests that global merchandise trade growth will likely moderate in the fourth quarter of 2017.

Commenting on the data, exporters body FIEO said the fall was expected as exporters were facing liquidity problem to pay GST for four months in a row without getting any refund. Goods imports last month were $37.12 billion, a gain of 7.6 percent from a year ago, data from the commerce and industry ministry showed.

As a result, non-oil/non-gold imports rose only 4.9 per cent, sharply lower than the 19.8 per cent in September and 20 per cent in August, indicating industrial production would suffer again in October.

Oil and non-oil imports grew by 27.89 per cent and 2.19 per cent to Dollars 9.28 billion and USD 27.83 billion, respectively in October. Aditi Nayar, principal economist with rating agency Icra, says: "Gold imports contracted in October despite onset of the festive and wedding season, given the build-up of substantial stocks over the past few months".

Other reports by Iphone Fresh

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