Posted at 5:53 PM , on April 26, 2016
Trade Deficit narrows, but is it sustainable?
The March Trade data announced during the week had some major positive indications. The exports showed a positive trend on a month-on-month basis while imports of gold were down. Trade deficit came down substantially to a little above $5 billion and is almost entirely compensated by the surplus on the services side. Some of the key takeaways from the trade data were as follows… Continue reading
Posted at 2:47 PM , on August 19, 2015
The trade data for the month of July 2015 continues to disappoint. The saga of falling exports started in the month of December 2014, and July 2015 marks the 8 consecutive month of fall in exports. For the month of July 2015, exports came in at $23.1 billion, a fall of 10.3% from the corresponding period last year. Exports for the month of July were only marginally better than the figure in June 2015. Imports too continued to fall 10.3% for the month of July 2015 to a level of $35.9 billion. This leaves the trade deficit for the month of July 2015 at $12.8 billion. This deficit is a cause of worry because it is $1.9 billion higher than the deficit figure we saw in June 2015. This data point is not too encouraging as far as the rupee / dollar parity is concerned. Continue reading
Posted at 11:38 AM , on May 19, 2015
The trade data released for the month of April has raised a set of serious concerns on the health of India’s trade account. Exports were down by 14% for the month of April to $22 billion. This becomes a little more disconcerting on the back of a 21% fall in exports in the month of March 2015. But, is this really a worry?
Yes, of course, it is…
The current government has been in power for the last 12 months and this is the 5th consecutive month that India has witnessed a fall in exports. The total exports for the fiscal year 2014-15 was just about $310 billion against a modest target of $340 billion, a shortfall of almost 10%. What is more worrying is that this consistent fall in exports has happened at a time when the Indian rupee has been consistently weakening closer to the 65/$ mark. This beats orthodox logic because normally a weak rupee is associated with a surge in exports. What about imports? Continue reading
Posted at 11:37 AM , on April 21, 2015
Why India should be seriously worried…
India’s trade deficit numbers are out and there is room for some real concern. The overall exports for the year were $310 billion and the imports were $448 billion, leaving a trade deficit of $138 billion. That approximately translates into a trade deficit of $11.5 billion per month. But the real story lies in the break-up of these numbers. Continue reading