India's trade deficit hits 5-month high as imports surge
India's trade deficit reached a five-month high of $30.4 billion in June due to a 31% surge in imports, particularly in crude oil and fertilizers. While exports grew by 15.4%, the rapid increase in import costs has put pressure on the country's trade balance.
Why it matters
The widening trade deficit is a key economic indicator that impacts currency valuation and national fiscal policy in a major emerging market.
NEW DELHI: India's trade deficit widened to a five-month high of $30.4 billion as imports jumped 31% - the fastest pace of expansion in nearly four years - to $70.8 billion, although exports retained their momentum.Latest data released by the commerce department on Monday estimated that exports rose 15.4% to $40.4 billion, but it was overshadowed by a surge in the import of crude, fertilisers, electronics and machinery.On account of high global prices, crude shipments jumped over 40% to $19.3 billion, while fertiliser imports trebled to $2.3 billion, with volumes also likely to have played a part. There was some comfort from bullion though as gold imports rose 7% to stay just below $2 billion, while silver was down 74% to $60 million, as global prices cooled and the impact of higher duty played out.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in