India’s trade deficit has taken a turn for the worse and the gap has widened due to the sharp increase in the gold imports and the non-oil exports which led to the trade deficit of $24.69 bn, according to the latest report released by the Ministry of Trade and Commerce on Wednesday, June 15, 2022.
India has another problem that it has to tackle shortly which includes the rising prices of global fuel. Due to the hike in prices, India’s import bill has risen by 62.83% year-on-year to $63.22 bn whereas, on the other hand, the exports rose by 20.55% to $38.94 bn.
“Based on the performance in April-May 2022. We foresee the current account deficit to widen to $26 billion. In the ongoing quarter compared to the $ 23 billion during the previous quarter”. Aditi Nayar, Chief Economist ICRA said.
“The merchandise exports in May 2022 were $38.94 billion. As compared to $32.30 billion in May 2021, exhibiting a positive growth of 20.55 percent. The estimated value of services export for May 2022 is $23.28 billion. Exhibiting a positive growth of 30.32 percent vis-a-vis May 2021 ($17.86 billion)”. The commerce and industry ministry said in a statement.
From April-May 2022 India’s total exports have $124.59 billion which had exhibited a positive growth of almost 26%, and the total merchandise export stood at almost $79 billion as opposed to 63.05 billion a year ago in 2021.
According to the World Bank, global trade is on the verge of being affected more due to the Russia-Ukraine war. “Russia and Ukraine account for a small share— under 3 percent—of global exports. However, many global industries rely on supplies of key commodities produced in the two countries. Especially in Russia,” the World Bank report stated. The report stated how the war has caused disruptions around the world surrounding global supply chains. As well as the distribution of materials.
Further details are yet to be received.