India: Trade deficit narrows in September
October 13, 2017
Merchandise exports expanded 25.6% in year-on-year terms in September to a total of USD 28.6 billion, well above the 10.3% increase recorded in August and the fastest expansion in six months. Oil export growth accelerated on account of a pick-up in crude prices, while non-oil exports accelerated across sectors, with textiles, engineering goods, chemicals and jewelry all recording strong increases in shipments overseas in September.
September’s leap fed into the 12-month trailing sum of exports, which rose to an over five-year high of 11.5% in September from 9.7% in August. The sum of exports in the 12 months up to September totaled USD 290 billion, slightly above the USD 285 billion recorded in August.
Import growth, on the other hand, rose 18.2% in annual terms in September, which was slightly below the 21.2% expansion recorded in the previous month. Imports totaled USD 37.6 billion in September. Meanwhile, the 12-month trailing sum of imports continued to trend higher at an annual increase of 20.3% in September, the highest increase since June 2012 and above August’s 18.6% increase. This brought imports to a total of USD 426 billion in September, higher than the USD 420 billion total recorded in August.
The robust performance in the external sector led the trade balance to narrow considerably in September, from the USD 11.7 billion shortfall recorded in August to a USD 9.0 billion deficit. In the 12 months up to September, the trade deficit was unchanged at August’s USD 135 billion.
Author: David Ampudia, Economist