Falling rupee fails to dent India's widening trade deficit
16 October 2018
India’s merchandise trade deficit during April-September 2018 rose to $94.32 billion with the addition of $13.98 billion in September 2018, which is also the lowest monthly shortfall for the last 5 months thanks to the falling rupee.
Exports from the country in September showed a negative growth of 2.15 per cent in dollar terms and a growth of 9.65 per cent in rupee terms.
Imports, on the other hand, grew at a much faster rate of 10.45 per cent in dollar terms and 23.78 per cent in rupee terms during the month.
Trade deficit for the month, however, remained much lower at $13.98 billion despite high oil prices.
A mid-year assessment by the commerce ministry showed exports growing in a healthy manner, building on export growth seen in 2016-17 and 2017-18.
In the first six months (April-September 2018) of the current fiscal, merchandise exports showed a positive growth of 19.93 per cent in rupee terms and 12.54 per cent in dollar terms.
Exports other than petroleum and gems and jewellery during April-September 2018 grew 10.32 per cent in dollar terms and at 17.51 per cent in rupee terms year-on-year.
The commerce ministry attributes the negative growth in exports in September to the base effect of an abnormally high growth of about 26 per cent in September 2017 due to the imminent cut off then for drawbacks at pre-GST rates.
During September 2018, major commodity groups showing positive export growth year-on-year included petroleum products (26.8 per cent), organic and inorganic chemicals (16.9 per cent), drugs and pharmaceuticals (3.8 per cent), cotton yarn/fabrics/made-ups, handloom products etc (3.6 per cent) and plastic and linoleum (28.2 per cent)
Imports during April-September 2018 exhibited a positive growth of 16.16 per cent in dollar terms.