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India: Trade deficit narrows in May

June 16, 2015

More recent data related to India’s external sector showed that the trade deficit totaled USD 10.4 billion in May, which was an improvement over the USD 11.2 billion shortfall observed in the same month last year. For the 12 months up to May, the trade deficit recorded USD 137.0 billion, which was slightly less than the 137.8 billion shortfall tallied in the 12 months up to April.

The narrowing in the trade deficit showed that imports contracted 16.5% annually in May, which was a steeper decline than the 11.4% drop registered in May of last year. The contraction was largely the result of the sharp decline in oil prices. Accordingly, oil imports totaled USD 8.5 billion, which represented a 41.0% decrease compared to the same month of the previous year.

Meanwhile, exports contracted 20.2% year-on-year in May, which contrasted the 12.4% expansion recorded in May 2014.

FocusEconomics Consensus Forecast panelists expect exports to increase 4.9% in FY 2015/2016, reaching USD 326 billion. In FY 2016/2017, the panel sees exports expanding 10.0% to USD 358 billion.


Author: Angela Bouzanis, Senior Economist

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India Trade Chart


India Trade12m May 2015

Note: 12-month sum of trade balance in USD billion and annual variation of the 12-sum of exports and imports in %.
Source: Ministry of Commerce and Industry and FocusEconomics calculations.


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