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India's exports up 3.93% in May; trade deficit widens to $15.36 bn

Press Trust of India/New Delhi 14 Jun 19 | 07:12 PM

India's exports grew by 3.93 per cent in May to $30 billion on the back of healthy growth in electronics and chemicals shipments, even as the trade deficit widened to a six-month high, official data showed Friday.

Imports increased by 4.31 per cent to $45.35 as crude oil and gold shipments shot up in the month.

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The trade deficit, difference between imports and exports, aggregated at $15.36 billion, the widest since November 2018, when it stood at $16.67 billion.

Sectors which recorded healthy export growth included electronics (51 per cent), engineering (4.4 per cent), chemicals (20.64 per cent), pharma (11 per cent) and tea (24.3 per cent).

However, certain key sectors including petroleum products, man-made yarn/fabrics, gems and jewellery, marine products, coffee and rice recorded negative growth in May, according to commerce ministry data.

Oil imports grew by 8.23 per cent to $12.44 billion and non-oil imports expanded by 2.9 per cent.

Gold imports jumped by 37.43 per cent to $4.78 billion in May.

Cumulatively, exports in April-May 2019-20 rose 2.37 per cent to $56 billion. Imports grew by 4.39 per cent to $86.75 billion, resulting in a trade deficit of $30.69 billion.

Commenting on the data, Federation of Indian Export Organisations (FIEO) President Ganesh Kumar Gupta said exports May recorded moderate growth in view of sluggish global trade.

"Such a growth in exports is a reflection of extremely modest growth in global trade and increasing protectionism. MSME sectors are still facing the problem of liquidity besides various other challenges including uncertainties owing to tariff war, volatility in commodities/currencies, rapid rise in trade restrictive measures and constraints on the domestic front," he said in a statement.

He also expressed concern on the rising trade deficit primarily on account of swelling crude import bill with further northward movement of prices and ban on Iranian imports along with rising gold imports.

He added that the government needs to look at issues like access to credit, cost of credit especially for merchant exporters and interest subsidy support to all agri exports.

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