India back to square one, Trade Deficit swings to negative

Source :Sify
Author :Finance Desk
Last Updated: Wed, Jun 16th, 2021, 05:59:02hrs
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Trade-Commerce

New Delhi: India's trade deficit (exports minus imports) according to latest data from India's ministry of Commerce and Trade has swung back to the negative mark. 

"The overall trade deficit (services plus merchandise) for the period April-May 2021 is estimated at $5.85 billion as compared to a surplus of $4.06 billion recorded during April-May 2020," read the release from the ministry. 

The ministry shared the provisional data for the financial year April 2020 to May 2021. Imports and exports have picked up in this period. 

Merchandise exports were estimated at $ 32.27 Billion compared to $19.05 Billion in the previous year -- a growth of 69.35 per cent. In Rupee terms, exports were estimated at Rs. 2.36 lakh crores for May 2021 - 64.00% yoy growth. 
India's bulk of exports were product groups such as agricultural products, Petroleum products, handicrafts, gems and jewellery, dairy products, etc. 

Imports stood at $38.55 Billion or Rs. 2.82 lakh crores -- an increase of 73.64 per cent in Dollar terms and 68.15 per cent in Rupee terms. In the last year, imports stood at $22.20 bn or Rs 1.67 lakh crores. 

Oil imports for this period are estimated at $9.45 billion - a 171 percent increase. The ministry quoted a World Bank estimate on global Brent price ($/bbl) increasing by 119.34% in May 2021 vis-à-vis May 2020 as a rational for the increase. 

Non-oil imports in May 2021 were estimated at USD 29.10 Billion (Rs. 2,13,198.28 Crore) which was 55.48 percent higher in Dollar terms (50.57 percent higher in Rupee terms), compared to USD 18.71 Billion (Rs. 1,41,597.18 Crore) in May 2020. 

Merchandise trade deficit ballooned by 99.61 percent within a year to hit $6.28 bn in May 2021. The estimate for Service trade balance, on the contrary, in May is a surplus of $7.88 billion.

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