Containers sit stacked next to gantry cranes at Krishnapatnam Port in Krishnapatnam, Andhra Pradesh, India. (Photographer: Dhiraj Singh/Bloomberg)

India’s Trade Deficit Narrows To 10-Month Low

India’s trade deficit narrowed to the lowest in 10 months in December as lower crude oil prices and falling gold demand reduced the burden on the import bill.

The gap between exports and imports stood at $13.08 billion, compared with $14.20 billion in the same month last year, according to a release from the Ministry of Commerce. That compares with Bloomberg’s deficit estimate of $14.5 billion.

India’s imports dipped 2.44 percent to $41.01 billion in December from $42.03 billion last year. The nation also imported crude oil worth $10.67 billion last month, which was 3.16 percent higher than December 2017. Brent crude prices decreased 12.07 percent in December from the same period last year.

The oil import bill during April-December 2018 was $108.10 billion—42.85 percent higher than last year’s $75.67 billion.

In late September, the government hiked import duty on 19 items in an attempt to curb the fall in the rupee and bridge the widening current account deficit.

Import Highlights:

  • Gold imports fell 24.3 percent to $2.56 billion.
  • Electronic goods imports fell 9 percent to $4.25 billion.
  • Pearls and precious stone imports declined 28.08 percent to $2.52 billion.
  • Iron and steel imports increased 15.6 percent to $1.43 billion.
  • Machinery imports rose 8.4 percent to $3.08 billion.
  • Coal and coke import shot up 11.4 percent to $2.26 billion.

Exports last month grew marginally to $27.93 billion compared with the same period last year, with increased shipments of petroleum products, electronic goods and plastic and linoleum.

Export Highlights:

  • Gems and jewellery exports fell 19.2 percent to $2.61 billion.
  • Engineering goods exports declined 5.5 percent to $7.16 billion.
  • Petroleum products exports increased 13.2 percent to $4.2 billion.
  • Drug and pharmaceuticals exports decreased 0.7 percent to $1.66 billion.
  • Chemical exports rose 5.5 percent to $2 billion.