Merchandise imports rose 10.25% from $49.06 billion in April 2023 to $54.09 billion in April 2024, leading to a $19.1 billion increase in the trade deficit, a five-month high reached. This increase was primarily driven by petroleum products. Imports of non-petroleum, non-precious stones and jewelry also registered a year-on-year increase of nearly 2%, reaching $32.72 billion in April 2024 compared to $32.13 billion in April 2023.
On the export front, non-petroleum and non-precious stones and jewelry items, which are considered indicators of export health, recorded a modest growth of 1.32% to US$ 26.11 billion against US$ 25.77 billion in April 2024 -dollar in April 2023. The main drivers of this growth were electronic goods (25.8%), tea (25.74%), organic and inorganic chemicals (16.75%), coffee (15.87%), tobacco (13.22%) %), spices (12.27%), petroleum products (3.1%) and medicines and pharmaceuticals (7.36%). However, exports fell in April in 17 out of 30 key sectors, including gems and jewelry, technical products, ready-made garments, artificial yarns and marine products.
Aditi Nayar, Chief Economist, ICRA, said: “India's merchandise trade deficit widened sharply to $19.1 billion in April 2024 compared to $14.4 billion in the same month last year, due to a rise in oil and non-oil trade -Oil deficits. That was.” The highest goods trade deficit in four months was also well above ICRA expectations. What is noteworthy is that the widening of the non-oil deficit in April 2024 compared to April 2023 was entirely due to a tripling of gold imports due to the increase in gold prices.”
“Overall, almost half of the widening of the total goods trade deficit between April 2023 and April 2024 was due to the increase in the value of gold imports as world prices rose. Merchandise exports recorded very slight growth and fell short of our April 2024 forecast. Currently, the current account deficit is expected to be a modest 1.2% of GDP for FY2025,” Nayar added.
Services exports recorded a growth of 14.7% to $29.57 billion in April 2024 compared to $25.78 billion in April 2023, while imports grew by 21.5% to $16.97 in April 2024 billion compared to $13.96 billion in April 2023, resulting in a surplus of $12.6 billion.
Additionally, the Commerce Ministry revised India's total exports (goods and services) to $778 billion for FY24, against the previously announced $776 billion, mainly due to positive growth in services exports.
