Trade Deficit: Official data show that a rise in crude oil imports pushed India’s goods import bill to $60.3 billion in April, up 31%. The trade imbalance widened this month to $20.11 billion, up from $18.5 billion in March, while merchandise exports increased 30.7 percent to $40.19 billion.
Meanwhile, S&P Global Market Intelligence reported on Friday that India’s crude oil imports reached a new high in April, reaching 4.8 million barrels per day. For the first time, Russian crude accounted for 5% of India’s total seaborne imports, according to the research firm.
Petroleum imports in April were estimated to be at $20.2 billion, up 87.5 percent from $10.7 billion in April 2021, according to trade data issued by the Commerce and Industry Ministry.
Slowing growth due to Trade Defict
The goods trade imbalance is expected to reach a new high of $250-255 billion in 2022-23, according to ICRA, as growth in merchandise exports slows to around 9% during the year. Imports, on the other hand, were forecast to increase by roughly 16%, with local demand expected to expand faster than external demand.
Petroleum items (up 126.7 percent), electrical goods (71.7 percent), cereals (60.8 percent), coffee (59.4 percent), processed food (38.8 percent), and leather products (36.7 percent) also contributed to April’s record goods exports, according to the Ministry.
Imports of coal and gasoline were greater than expected, with the former jumping 146.3 percent to $4.93 billion. Fertilizer imports nearly tripled to $1.2 billion in April 2021, from $376 million. These three import goods’ increased worth shows the rapid rise in worldwide pricing. “While imports and exports both increased sharply, the goods trade deficit worsened to $20.1 billion… owing to oil,” Aditi Nayar, ICRA’s chief economist, remarked. “Given the elevated commodity costs following the Russia-Ukraine crisis, total merchandise imports remained above $60 billion for the second month in a row,” she added.