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Imports up 46%, trade deficit hits record $30 billion

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NEW DELHI: India’s exports inched up by just over 2% to $36. 3 billion in July, while imports jumped 46% to $66. 3 billion, pushing up the trade deficit to new high, official data released by the commerce department on Friday showed.
July’s exports have seen the slowest pace of expansion since the start of 2021 but is better than the 0. 8% contraction in the preliminary estimates released by the department at the start of the month. Import numbers remained virtually unchanged. But it still left a record monthly trade deficit of $30 billion, even when compared with the earlier estimate of $31 billion.
The export slowdown in July was driven by a fall in the value of some high-value segments, such as engineering goods, garments, cotton yarn and fabrics, plastics and pharmaceuticals, even as oil products, electronics goods and chemicals bucked the trend.
“Signs of a likely slowdown in exports can been seen as global inventories are pretty high and merchandise exports are facing a triple whammy: i) There is again a shift in consumption from goods to services, with opening up of economies after pandemic, ii) inflation affecting all economies reducing purchasing power, and iii) many economies are entering recession, while some advanced ones are already in recession. The reduction in voyage time, with normalisation of Covid disruptions, have also added to the inventory hike,” lobby group Fieo said.

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