In Charts: India’s Foreign Trade In 2018
India’s trade deficit—the gap between imports and exports—narrowed to its lowest in 10 months at $13 billion in December. But that doesn’t capture the volatility seen in the trade gap on account of fluctuations in oil prices and currency.
Even the government had to step in to impose curbs on certain imports to rein in the current account deficit, which is linked to the trade gap.
Oil continued to be the biggest burden on India’s import bill. Imports of electronic items were the second-highest by value. Outbound shipments of gems & jewellery, drugs & pharmaceuticals, chemicals and engineering goods—that make up more than half of India’s exports—grew in 2018.
The trade deficit will depend on the nature of international oil prices, according to Anand Rathi Financial Services Ltd. “On the contrary, a rise in shale oil production in the U.S. will act as a counter balance to price. We think that oil prices will rise but not very significantly,” it said in a recent report.
Here’s India’s trade in 2018 in charts
Export Vs Import Growth
India’s trade deficit swelled to a five-year high at $18 billion in July. Since then, it has contracted and ended the year at $13 billion. That was largely because imports entered the negative territory due to lower oil prices.
Major Imports: Gold And Oil
From a 93 percent rise in August, gold imports contracted 16 percent in November and 24 percent in December. That has contributed significantly to the overall leaner trade deficit. Oil imports, too, had ended lower than where they were at the start of 2018.
Non-Oil, Non-Gold Imports
Imports, excluding oil and gold, have also been on the decline since November. However, before that since May 2018, their growth had been in the positive territory.
While exports of engineering goods were most in December, that of electronic goods saw the highest growth.
Oil is the most imported item in India by value. However, growth in imports was the highest for fertilisers as imports nearly doubled over last year.