India: Merchandise exports fall for first time in four years in March
Merchandise exports fell—for the first time in four years—0.7% annually in March, after increasing 11.9% in February. Meanwhile, merchandise imports decreased 6.0% on an annual basis in March (February: +12.2% yoy).
As a result, the merchandise trade balance improved from the previous month, recording a USD 15.6 billion shortfall in March (February 2024: USD 18.7 billion deficit; March 2023: USD 19.7 billion deficit). Lastly, the trend improved, with the 12-month trailing merchandise trade balance recording a USD 245.3 billion deficit in March, compared to the USD 249.5 billion deficit in February.
Our panelists expect merchandise exports to grow less than merchandise imports in 2024 and bring the trade balance deeper into the red.
Analysts at EIU said:
“We expect the current-account deficit to widen slightly in 2024 from its level in 2023, reflecting a growing trade deficit. However, the robust services account surplus and high remittance inflows will prevent a further widening of the overall deficit. Our forecasts assume that declining global commodity prices will keep India’s import bill in check. Weak external demand will affect the pace of goods export growth in 2024, but exports in certain segments will perform well.”