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India’s merchandise exports declined 12.7% to a six-month low of $34.66 billion in April, but imports fell 14% to $49.90 billion in April, according to preliminary estimates from the commerce ministry released on Monday.
As a result, the monthly goods trade deficit narrowed 17% to a 20-month low of $15.24 billion in April from $18.35 billion a year earlier. Sequentially, outbound shipments fell 17.3% from March’s exports of $41.9 billion, the most since June 2022.
Officials attributed the fall in exports to weak demand in key markets and fall in commodity prices. Santosh Kumar Sarangi, director general of foreign trade and additional secretary in the commerce ministry, said the broad picture is that imports have declined sharply.
“Part of this is due to reduction in commodity prices and part of it has to do with lower demand for products that are treated as discretionary spending like gems and jewellery. So their imports are falling along with petroleum, and both are also export oriented… Decrease in demand for such items is likely to lead to fall in imports as well as exports.’ Hindu,
“Global demand from markets like EU and US is not looking good. For the next two-three months, the demand scenario does not look very optimistic,” Mr Sarangi said, adding that the government would initiate inter-ministerial talks to find ways to diversify and maintain the export momentum.
“Hopefully, things will change from August-September. The Chinese economy is opening up, and keeping this in mind, the World Trade Organization has revised its global trade growth from 1% to 1.7%, and if demand from the EU and the US improves in August or later. It can boost our exports. He agreed.
“Taking into account the estimated services trade during April, the overall trade deficit is only $1.38 billion, the lowest in 21 months,” Mr. Sarangi said. Actual services trade data is subsequently released by the Reserve Bank of India.
The ministry also released updated trade numbers for 2022-23, which showed merchandise exports grew by 6.7% to cross $450 billion, higher than earlier estimates. Including services trade, total exports grew by 14.7% to $775.87 billion for the year.