India’s trade deficit widens to $19.1b in April

India’s trade deficit in April widened to $19.1 billion, surpassing economists’ expectations of $17.23 billion, marking a further expansion from the $15.6 billion deficit recorded in March, Reuters reported on Wednesday, citing government data.

Exports slip, imports rise:

Merchandise exports for April stood at $34.99 billion, down from $41.68 billion in March.

Conversely, imports climbed to $54.09 billion from $57.28 billion in the previous month.

A major contributor to the rising import bill was gold. Imports more than doubled to $3.11 billion in April, compared with $1.53 billion in March.

Trade Secretary Sunil Barthwal downplayed concerns about gold imports, stating they fall within the usual trend and are partly influenced by central banks worldwide increasing gold purchases due to global conflicts. Rising gold prices further amplify the value of imports.

The share of gold in India’s foreign reserves has also climbed, reaching 8.15 per cent at the end of March, compared to 7.37 per cent at the end of September 2023.

Despite the widening trade gap, India’s services sector exports in April reached $29.57 billion, while imports stood at $16.97 billion. These figures are slightly higher than March’s $28.54 billion and $15.84 billion, respectively.