Exports rise marginally in Aug; trade gap more than doubles to $27.98 bn

India's exports rose marginally by 1.62 per cent to USD 33.92 billion and trade deficit more than doubled to USD 27.98 billion in August, data released by the commerce ministry said on Wednesday.

Trade deficit in August 2021 stood at USD 11.71 billion.

Imports rose by 37.28 per cent to USD 61.9 billion in August this year.

During April-August 2022-23, exports registered a growth of 17.68 per cent to USD 193.51 billion. Imports during the fivemonth period of this fiscal grew by 45.74 per cent to USD 318 billion.

Trade deficit widened to USD 124.52 billion in April-August this fiscal as against USD 53.78 billion in the same period last year.

Merchandise exports increased 1.6% on year to $33.92 bln in August, but fell 6.5% sequentially. A consistently high trade deficit is likely to put pressure on India's current account deficit. This will also put pressure on the rupee, which has been on a falling spree for the past few months. The rupee, which today closed at 79.44 a dollar, had fallen to a record low of 80.13 per dollar on Aug 29.

Earlier in the month, Commerce Secretary B.V.R Subrahmanyam had said that India's current deficit is likely to touch 3% of GDP at the end of the current financial year.

Amid a high trade deficit, Finance Minister Nirmala Sitharaman on Tuesday said that the RBI's mechanism to facilitate international trade in rupee has placed India in the spotlight, with multiple countries showing interest.

In July, the central bank had announced steps to boost imports and exports through rupee-denominated trade, which was not only beneficial for trade with Russia, but neighbouring nations as well, especially those facing sanctions from the west after the Ukraine war.

The pandemic adversely affected trade across the world and the Russia-Ukraine war further exacerbated the problem, Sitharaman said.