India's Merchandise Exports Drop in July Due to Weak Oil, Gems, and Jewellery Exports
India's Merchandise Exports Drop in July
New Delhi, August 19: India's merchandise exports fell in July due to weak oil, gems, and jewellery exports, according to Crisil Ratings. High domestic demand for oil products also contributed to the decline. Despite this, the fiscal year started well with steady growth in the first quarter.
Export and Import Details
In July, India's merchandise exports were USD 33.9 billion, a 1.5% decrease from the previous year. Core exports grew by 5.7%, led by electronic goods, meat, dairy, poultry products, oil meals, ready-made garments, spices, and tea. However, gems and jewellery exports fell by 20.4%, ceramic products and glassware by 21.1%, organic and inorganic chemicals by 12%, and rice by 15.3%.
Imports grew by 7.5% in July, driven by higher oil imports, which accounted for USD 13.87 billion or 24.1% of total imports. The trade deficit widened to USD 23.5 billion, the largest in nine months.
Cumulative Data
From April to July, merchandise exports rose by 4.15% to USD 144.12 billion, while imports grew by 7.6% to USD 229.7 billion. This increased the trade deficit to USD 85.6 billion. Services exports grew by 3.7% in June, resulting in a services trade surplus of USD 14.4 billion.
Future Outlook
Crisil remains optimistic, noting the government's focus on foreign trade agreements. The agency will monitor whether the July contraction in exports continues.
Doubts Revealed
Merchandise Exports
Merchandise exports are goods that a country sells to other countries. For example, India might sell clothes, electronics, or food to other countries.
Fiscal Year
A fiscal year is a 12-month period used for budgeting and financial reporting. In India, it starts on April 1 and ends on March 31 of the next year.
Trade Deficit
A trade deficit happens when a country imports more goods than it exports. This means India is buying more from other countries than it is selling to them.
USD
USD stands for United States Dollar, which is the currency used in the United States. It is often used in international trade.
Crisil
Crisil is a company in India that provides ratings, research, and risk analysis. They help businesses and governments understand financial risks and opportunities.
Foreign Trade Agreements
Foreign trade agreements are deals between countries to make it easier to buy and sell goods with each other. These agreements can reduce taxes and other barriers to trade.
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