India's trade deficit narrows to $10.9 billion
New Delhi: India's trade deficit narrowed to USD 10.9 billion in August from USD 12.27 billion in the previous month on the back of higher exports and lower imports, government data showed Tuesday.
Exports jumped by 12.97 percent to USD 26.13 billion in August. This is the second straight month of a healthy double-digit growth in exports. It increased by 11.64 percent to USD 25.83 billion in July.
Imports declined by 0.68 percent to USD 37.05 billion in the month under review, leaving a trade deficit of USD 10.92 billion. Trade deficit was recorded at USD 12.27 billion in July.
Addressing a media briefing, Commerce and Industry Minister Anand Sharma said the trade deficit had narrowed on the back of a consistent decline in gold imports.
“Gold imports have come down... it is coming down consistently,” said Sharma, adding that the government was trying to further lower the trade gap.
The value of gold imports fell to USD 0.65 billion in August as compared to USD 2.2 billion in the previous month.
The minister hoped that exports would register healthy growth in coming months.
“Exports are on a firm, positive terrain now. I remain optimistic about exports being in positive territory,” he said.
Exports have registered healthy double-digit growth in the last two months after posting decline in the first quarter of the current financial year.
The cumulative value of exports for the period April-August USD 124.42 billion, as compared to USD 119.77 billion registered during the corresponding period of last year, showed an year-on-year growth of 3.89 percent.
The value of imports increased by 1.72 percent to USD 197.79 billion in the first five months of the current financial year.
The trade deficit for April-August declined marginally to USD 73.36 billion, as compared to USD 74.67 billion in the corresponding period of last year.
Oil import surged by 17.88 percent to USD 15.09 billion in August. For April-August period oil import was valued at USD 69.67 billion, 5.6 percent higher than the oil imports bill of USD 65.98 billion, in the corresponding period last year.
Non-oil imports fell by 10.4 percent to USD 21.95 billion in August.
A sharp depreciation in the value of rupee has helped boost exports, while made imports costlier.
The rupee lost almost 20 percent of its value this year and hit a record low of 68.85 against the US dollar last month.
The rupee strengthened to two-week high of 64.17 against a dollar on positive trade data. Lower trade deficit will help in curbing current account deficit, a major reason for the recent sharp depreciation in the value of rupee.