The country’s merchandise trade deficit – the gap between imports and exports, widened to a record $22.6 billion in September 2021 – the highest level in at least 14 years, according to news agency Reuters.
Trade Deficit In September 2021: Here’s All You Need To Know
The country’s overall exports (merchandise and services) rose 21.44 per cent to $54.06 billion in September from $44.52 billion in the corresponding month last year, while overall imports grew 70 per cent to $68.49 billion from $40.29 in the year-ago period, according to government data released on Thursday.
Merchandise exports rose 22.60 per cent to $33.79 last month from $27.56 in the same month last year, while merchandise imports grew 84.76 per cent to $56.39 billion from $30.52 in the year-ago period, according to data by the commerce industry today. The purchases of crude oil and gold pushed imports to record-high levels last month.
The foreign trade data for September 2021 is an estimation, and will be revised based on the Reserve Bank of India’s subsequent release, said the commerce ministry.
The overall exports in the April-September period is estimated at $312.47 billion, marking a growth of 40.52 per cent over the corresponding period last year, and a growth of 18.30 per cent compared to the April-September period in 2019 (pre-Covid era).
In terms of exports, the major groups of commodities exhibiting growth in September 2021 are coffee, cashew, petroleum products, cotton/yard. handloom products, engineering goods, among others.
Whereas, the major groups of commodities exhibiting de-growth in September include iron ore, oil meals, oil seeds, tobacco, ceramic products and glassware, spices, meat, dairy and poultry products, drugs and pharmaceuticals.
The oil imports rose nearly three times to $17.44 billion in September 2021 from $5.83 billion in the corresponding month last year, while gold imports jumped to $5.1 billion from $601 million.
”The sharp rise in merchandise trade deficit reflected advance imports to build up inventories ahead of the festive season and higher oil imports to partly offset hardening prices”, said Aditi Nayar, Chief Economist at ICRA, – the Indian arm of rating agency Moody’s.
“The trade deficit is expected to moderate in subsequent months,” she added, noting that it could fall to in the range of $13 billion to $16 billion a month in the second half of the current fiscal.