Weak exports and declining oil prices pulled India’s trade deficit to an 11-month low of $8.32 billion in January this year, against $9.45 billion in the year-ago period.
However, exports contracted by 11.19% to $23.88 billion against $26.89 billion last year, thereby cautioning the economy at a time when the government is trying to push growth.
Almost all sectors witnessed a declining trend in exports including tea-coffee, rice, spices, gems and jewellery, among others.
According to the commerce ministry statement, outbound shipments of cotton yarn, chemicals, pharmaceuticals and gems and jewellery contracted by 9.15%, 10.52%, 0.16% and 3.73%, respectively in January this year.
Imports, too, slipped in January by 11.39% to $32.2 billion, against $36.3 billion in the same month last year, on the back of declining oil prices.
Gold imports surged by 8.13% to $1.55 billion on easing of restrictions by the Reserve Bank.
Imports in sectors such as machinery both electrical and non-electrical, project goods and key inputs such as precious and semi-precious stone, ferrous metal, organic and inorganic chemicals witnessed a negative growth.
“Decline in imports on account of crude prices is understandable, but the negative growth in import of other crucial sectors do not augur well for country’s manufacturing dream,” said Rafeeque Ahmed, president, Federation of Indian Export Organisations (FIEO).
On cumulative basis, for April-January period in 2014-15, exports grew by 2.44% to $265 billion, along with a rise of 2.17% in imports, leaving a trade deficit of $118.37 billion.