Exports up 67% to $32bn; trade deficit at $6.32 bn
Imports in May climbed 68.54% to $38.53 billion, from $22.86 billion in May
NEW DELHI: India’s exports grew by 67.39% to $32.21 billion in May driven by healthy growth in sectors such as engineering, petroleum products and gems and jewellery, even as trade deficit widened to $6.32 billion, according to government data released on Wednesday.
Exports in May last year stood at $19.24 billion and in May 2019 it was at $29.85 billion, the commerce ministry’s preliminary data showed.
Imports in May rose by 68.54% to $38.53 billion, from $22.86 billion in May 2020. In May 2019, imports stood at $46.68 billion.
On a monthly basis, India’s trade position has returned to the familiar deficit territory after witnessing a rare trade surplus of $800 million last year at the height of the Covid-19 pandemic-induced national lockdown. In March, it was $13.93 billion. Economists say that the trade deficit will continue to widen.
“India is thus a net importer in May 2021 with a trade deficit of $6.32 billion, an increase of 74.69% over trade deficit $3.62 billion in May 2020 and reduction by 62.49% over trade deficit $16.84 billion in May 2019,” the ministry said.
The country’s merchandise exports in April had jumped nearly three-fold to $30.63 billion, even as the trade deficit widened to $15.1 billion.
Oil imports during May this year rose to 9.45 billion, as compared to $3.57 billion in May 2020. In May 2019, it stood at $12.59 billion.
Exports during April-may this year have jumped to $62.84 billion, as against $29.6 billion in the same period last year. It was $55.88 billion in April-may 2019, the data showed.
Imports during April-may 2021 was $84.25 billion, up from $39.98 billion in April-may 2020. In April-may 2019 it stood at $89.07 billion.
In April-may 2021, oil imports aggregated at $20.32 billion, up from $8.24 billion in April-may 2020. In April-may 2019 it was $24.16 billion.
Exports of engineering, petroleum products and gems and jewellery in May stood at $3 billion, $3.51 billion and $1.9 billion respectively.
Commenting on the data, Trade Promotion Council of India (TPCI) Founder Chairman Mohit Singla said that the fall in the import of newsprint, transport equipment and iron and steel is a welcome trend towards self-reliance, as it shows that the government’s import substitution strategy has strongly worked for these sectors.
In May, gems and jewellery (13.4%), readymade garments (28%) and leather (36%) were among sectors that saw the steepest fall, indicating that labour issues may also have played a part.
In contrast, engineering products (16%), iron ore (155%) and oil products (7%) were among the top performers. Exporters said that the order book remained healthy as vaccination in the US and Europe had resulted in opening up of businesses over the last few weeks. As a result, even sectors such as gems and jewellery, were seeing good demand from the US and China.
The Engineering Export Promotion Council (EEPC) said that shipments in the sector saw a substantial year-on-year rise in May primarily on account of low-base due to strict lockdown in the same month last year.
“We expect the order book of exporters to remain strong in the current financial year given the demand trend from key markets such as US, China and Europe,” it said in a statement.