Export growth at 8-month low in July; trade deficit widens
New Delhi: India's export growth slowed to eight-month low of 3.94 per cent in July, while the trade deficit widened to $11.44 billion on account of high gold imports, official data released on Monday showed.
The country's overseas shipments aggregated at $22.54 billion in July 2017 against that of $21.68 billion in the same month of last year, showing a growth rate of 3.94 per cent. It is the lowest export growth since November 2016 when shipments had expanded by 2.29 per cent.
Thereafter, the growth rate had risen to 27.59 per cent in March before it began to decelerate.
A contraction in export of pharmaceuticals, gems & jewellery and ready-made garments hit the overall export growth in July. Import rose by 15.42 per cent to $34 billion in July from $29.45 billion in the year-ago month due to rise in inward shipments of crude oil and gold.
Gold imports increased by 95 per cent to $2.10 billion in July against $1.07 billion in the same month last year.
Trade deficit, however, narrowed when compared to the previous month. In June, the gap stood at $12.96 billion. In July it was lowest in five months. Oil import was valued at $7.84 billion in July, an increase of 15 per cent over the same month in 2016.
Cumulative export during April-July of 2017-18 rose by 8.91 per cent to $94.75 billion while import increased by 28.30 per cent to $146.25 billion, leaving a trade deficit of $51.5 billion.
Engineering goods, petroleum, chemicals, marine products were some of the sectors which contributed to the positive growth during the month.
Exporters body Federation of Indian Export Organisations (FIEO) expressed concern over major product categories such as gems & jewellery, pharmaceuticals and ready-made garments recording negative growth in July.
FIEO President Ganesh Gupta cautioned that the order booking position from October onwards is "not very promising and the appreciation of domestic currency with increasing pressure on liquidity under GST may affect exports in the last quarter of 2017 bringing exports to about $310 billion in the current fiscal".