India’s Trade Deficit Widens to $27.14 Billion in October
India’s merchandise trade deficit widened to $27.14 billion in October, up from $20.8 billion in September, as imports grew at a faster rate than exports. Data released on November 14 highlights the sharp sequential increase in imports, which outpaced the growth in exports.
While merchandise exports saw a robust year-on-year increase of 17.23%, amounting to $39.2 billion—the fastest growth in 28 months—imports rose 3.9% during the same period, driven by rising demand across multiple sectors.
Key Export and Import Drivers
Major contributors to export growth included engineering goods (39.7%), electronic goods (45.69%), and organic and inorganic chemicals (27.35%). Meanwhile, imports of vegetable oil surged by 36%, gold imports rose sharply to $7.13 billion from $4.39 billion in September, and crude oil imports increased to $18.2 billion from $12.5 billion.
Yearly and Fiscal Trends
Compared to October 2023, the trade gap narrowed by $3.29 billion. Merchandise exports for the April-October period increased to $252.28 billion, up from $244.51 billion last year. However, the cumulative trade deficit widened to $164.65 billion, higher than $149.67 billion during the same period in 2023.
Commerce Secretary Sunil Barthwal expressed optimism about the export performance, stating, “Despite the volatile global atmosphere, Indian exporters have been able to overcome that situation and deliver.” Barthwal added that the government is on track to exceed its $800 billion target for overall exports (goods and services) in the current fiscal year.
Services Trade Outlook
The commerce ministry projected a 21.3% year-on-year increase in services exports for October, while imports in the services sector were expected to decline by 20.8%. As a result, the total trade balance for October is estimated at $10.12 billion, down from $15.85 billion in the same month last year.
India’s trade performance underscores both resilience in exports and the challenges posed by rising imports, particularly in commodities like gold and crude oil.
