New Delhi: While economists had estimated that India’s trade deficit will touch the $19.5 billion mark, the actual figure exceeded the estimate with the trade deficit widening to $23.78 billion.
Back in March, India’s trade deficit had narrowed to $15.6 billion, which was an 11-month low, reported The Economic Times.
The country’s merchandise exports increased by 9 per cent to $38.13 billion in May from a year earlier. This rise in the exports is owing to increase in shipments of engineering goods, commercial vehicles and smartphones, indicated government data.
While global economic uncertainties persisted, healthy growth was witnessed in sectors including electronics, pharmaceuticals, textiles and plastics, said the ET report.
In the same month, merchandise imports increased by 7.7% year-on-year to $61.91 billion.
Experts say that merchandise exports, which had dropped to 3.1% to $437 billion in the last fiscal year, are expected to gain pace after being helped by a projected rebound in global trade. Government incentives for manufacturing and easing domestic inflation are also likely to play a role.
Meanwhile, oil imports increased by 28% to $20 billion in May. It was up by 24.4% during April-May 2024-25 to $36.4 billion.
While releasing the figure, Trade Secretary Sunil Bharthwal said that inflation has eased in developed economies, potentially leading to better demand, and an increase in imports from India, reported The Economic Times.
According to the commerce ministry data released on Wednesday, the estimated value of services export in May is $30.16 billion which stood at $26.99 billion in May 2023. Imports of services are estimated to have risen to $17.28 billion in May as compared to $15.88 billion in May 2023.
