Exports grow 3.93% to $30 billion in May; trade deficit at 6-month high
Imports increased by 4.31 per cent to $45.35 as crude oil and gold shipments shot up in the month; the trade deficit aggregated at $15.36 billion, the widest since November 2018, when it stood at $16.67 billion
India’s exports grew by 3.93 per cent in May to USD 30 billion on the back of healthy growth in electronics and chemicals shipments, even as the trade deficit widened to a six-month high, official data showed Friday. Imports increased by 4.31 per cent to USD 45.35 as crude oil and gold shipments shot up in the month. The trade deficit, difference between imports and exports, aggregated at USD 15.36 billion, the widest since November 2018, when it stood at USD 16.67 billion.
Sectors that recorded healthy export growth included electronics (51 per cent), engineering (4.4 per cent), chemicals (20.64 per cent), pharma (11 per cent) and tea (24.3 per cent). However, certain key sectors including petroleum products, man-made yarn/fabrics, gems and jewellery, marine products, coffee and rice recorded negative growth in May, according to commerce ministry data. Oil imports grew by 8.23 per cent to USD 12.44 billion and non-oil imports expanded by 2.9 per cent.
Gold imports jumped by 37.43 per cent to USD 4.78 billion in May. Cumulatively, exports in April-May 2019-20 rose 2.37 per cent to USD 56 billion. Imports grew by 4.39 per cent to USD 86.75 billion, resulting in a trade deficit of USD 30.69 billion. Commenting on the data, Federation of Indian Export Organisations (FIEO) President Ganesh Kumar Gupta said exports May recorded moderate growth in view of sluggish global trade.
“Such a growth in exports is a reflection of extremely modest growth in global trade and increasing protectionism. MSME sectors are still facing the problem of liquidity besides various other challenges including uncertainties owing to tariff war, volatility in commodities/currencies, rapid rise in trade restrictive measures and constraints on the domestic front,” he said in a statement.
He also expressed concern on the rising trade deficit primarily on account of swelling crude import bill with further northward movement of prices and ban on Iranian imports along with rising gold imports. He added that the government needs to look at issues like access to credit, cost of credit especially for merchant exporters and interest subsidy support to all agri exports.
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