India’s trade deficit shrank to its lowest in five months in September, at $13.98 billion, even as exports contracted for the first time in as many months, according to official data released on Monday.
The data from the government’s mid-year assessment of India’s trade shows that merchandise exports registered a growth of 19.93% in rupee terms and 12.54% in U.S. dollar terms.
“Merchandise trade deficit is $13.98 billion in September 2018, lowest in last five months, despite high oil prices,” the government said in a statement.
“Merchandise exports in September 2018 exhibited a positive growth of 9.65% in rupee terms. In dollar terms, there was a marginal negative growth in merchandise exports of 2.15% in September 2018.”
“This decline is entirely due to the base effect resulting from September 2017 being an abnormally high growth month of about 26% in dollar terms due to the imminent cut off then for drawbacks at pre-GST rates,” the statement added.
“Though the data shows a marginal negative growth in the month of September, primarily due to high base effect last year, the aggregate value of exports in this September is much more than in the month of April, June and July of 2018 in which we recorded as high as 17% growth,” said Ganesh Kumar Gupta, president of the Federation of Indian Export Organisations.
During September, the major commodity groups that saw a strong export growth included petroleum products (26.8%), organic and inorganic chemicals (16.9%), drugs and pharmaceuticals (3.8%) and cotton yarn/fabs./made-ups, handloom products, etc. (3.6%) and plastic and linoleum (28.2%) in dollar terms. “Imports in April-September 2018 exhibited a positive growth of 16.16% in U.S. dollar terms,” the statement said.
“In September 2018, imports exhibited a positive growth of 10.45% in U.S. dollar terms (which is the lowest in last five months) and 23.78% in rupee terms.”