India’s exports in January rise 3% and trade deficit at its lowest level in nine months despite the Red Sea crisis | Top Vip News

India’s merchandise trade deficit narrowed to $17.49 billion in January, the lowest level in nine months, as exports rose 3.1 percent year-on-year even as the ongoing Red Sea crisis disrupts trade as commercial ships passing through the Suez Canal face attacks from Yemen. government-backed Houthi rebels.

The merchandise trade deficit stood at $19.8 billion in December 2023.

January’s goods trade deficit figure is the lowest since April 2023, when the gap was $15.24 billion.

Also read: Russian oil purchases in India become more expensive due to Houthi attacks

According to data released by the Ministry of Commerce on February 15, India’s exports in the first month of 2024 amounted to $36.92 billion, up from $35.8 billion in January 2023, but down from $38.45 billion. of December 2023 dollars.

“Despite the Red Sea crisis, continued recession in advanced nations and falling commodity prices, we have been able to achieve a positive growth rate of merchandise exports,” said Commerce Secretary Sunil Kumar Barthwal, in a briefing.

“The increase in exports, even though the Red Sea crisis poses a challenge on the logistics front, demonstrates not only the resilience of the sector but also of the export community, which has been continuously defying such adversities since the Russia-Russia war. and Ukraine. Exporters have been consistently driving export growth and also contributing to the growth momentum of the economy,” said Israr Ahmed, president (officer), Federation of Indian Export Organizations (FIEO).

FIEO’s Ahmed reiterated that the need of the hour is to address the challenges of the Red Sea crisis by ensuring availability of marine insurance, regular supply of containers and rational increase in freight costs. He added that the sector also needs easy and low-cost credit, marketing support, as well as the early conclusion of some of the key trade pacts with the United Kingdom, Oman and the European Union.

The main drivers of merchandise export growth in January 2024 were petroleum products, engineering goods, iron ore and electronic products, among others. Exports of petroleum products grew 6.57 percent year-on-year to $8.21 billion in January 2024.

Meanwhile, India’s merchandise imports also rose 3.0 percent year-on-year last month to $54.41 billion, although they were lower than $58.25 billion in December 2023.

Between April 2023 and January 2024 as a whole, India’s goods exports amounted to $353.92 billion, down 4.9 percent from the first 10 months of 2022-23. Imports fell an even steeper 6.7 percent year-on-year to $561.12 billion. As a result, the merchandise trade deficit was almost 10 percent smaller, standing at $207.2 billion between April 2023 and January 2024.

Barthwal told reporters on February 15 that while the global situation, given the conflicts, does not look very optimistic, the government will continue to work with exporters to ensure that outbound shipments continue to grow.

The overall trade deficit (goods and services combined) is expected to improve by 37.11 per cent in April-January 2023-24 on a year-on-year basis, while the merchandise trade deficit reduced by 9.66 per cent during the same period.

India’s total exports (goods and services combined) in January 2024 are estimated at $69.72 billion, representing a positive growth of 9.28 percent year-on-year, while total imports are projected at $70.46 billion. dollars, 4.15 percent more than in January 2023.

India’s Commerce Ministry expects services exports, a consistent bright spot for the country’s overall trade dynamics, to see a 17.14 percent year-on-year rise in January 2024, while service imports are estimated to will experience a relatively lower growth rate of 8.22 percent during the same period.