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Care Ratings Research Report
India’s merchandise trade in the first half of 2020-21 has been marked by a sharp narrowing of the trade deficit, which has dropped to a 15 year low.
Under normal conditions, a lower trade deficit for the country would be viewed favourably.
However, given that the decline in the current financial year has been facilitated by the severe contraction of imports as well as exports, it portends prolonged weakness for the domestic economy.
Exports in H1 2020-21 have fallen to 10 year lows and imports were at the lowest level in 11 years.
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