Gold Imports Crash in March, Trade Deficit, Export Fall Arrested

India’s Trade Deficit at a Record Low Of $5 billion in March

Steep fall in gold import seen as reason for the fall; exports slump by 5.47% in the month, imports shrink 21.56%

A sharp decline in the gold imports helped narrow India’s trade deficit to a record low, as merchandise imports contracted faster than exports in March amid tepid global demand.

Gold imports declined 80.5% to $973 million in March.

Data released by the Union commerce ministry showed that while merchandise exports contracted for the 16th straight month by 5.47%, merchandise imports shrank 21.56%, leading to a trade deficit of $5 billion in March. During the same month, China’s exports grew by 11.5%, breaking the declining trend, and imports contracted 7.6%, leaving that country with a trade surplus of $29.9 billion.

India’s exports fell 15.9% to $261.1 billion in 2015-16 while imports contracted by 15.3% to $379.6 billion. The trade deficit for the year was $118.5 billion.

Although non-oil, non-gold imports contracted in March 2016, the healthy growth in imports of some items, such as transport equipment and electronic goods, signals a nascent uptick in domestic investment and consumption demand.

Exports (including re-exports)

Exports during March, 2016 were valued at US$ 22718.69 million (Rs.152264.96 crore) which was 5.47 per cent lower in Dollar terms (1.45 per cent higher in Rupee terms) than the level of US$ 24032.55 million (Rs.150082.80 crore) during March, 2015. Cumulative value of exports for the period April-March 2015-16 was US$ 261136.80 million (Rs.1708841.43 crore) as against US$ 310338.47 million (Rs.1896348.40 crore) registering a negative growth of 15.85 per cent in Dollar terms and 9.89 per cent in Rupee terms over the same period last year.

Non-petroleum exports in March 2016 are valued at US$ 20639.78 million against US$ 21386.48 million in March 2015, a reduction of 3.49 per cent. Non-petroleum exports during April to March 2016 are valued at US$ 231952.95 million as compared to US$ 253544.33 million for the corresponding period in 2015, a reduction of 8.52 per cent.

Imports

Imports during March, 2016 were valued at US$ 27789.56 million (Rs.186250.88 crore) which was 21.56 per cent lower in Dollar terms and 15.82 per cent lower in Rupee terms over the level of imports valued at US$ 35428.72 million (Rs.221251.65 crore) in March, 2015. Cumulative value of imports for the period April-March 2015-16 was US$ 379596.17 million (Rs.2481367.22 crore) as against US$ 448033.42 million (Rs.2737086.58 crore) registering a negative growth of 15.28 per cent in Dollar terms and 9.34 per cent in Rupee terms over the same period last year.

Crude Oil and Non-Oil Imports

Oil imports during March, 2016 were valued at US$ 4799.96 million which was 35.30 per cent lower than oil imports valued at US$ 7418.51 million in the corresponding period last year. Oil imports during April-March, 2015-16 were valued at US$ 82662.26 million which was 40.24 per cent lower than the oil imports of US$ 138325.50 million in the corresponding period last year. 

Non-oil imports during March, 2016 were estimated at US$ 22989.60 million which was 17.92 per cent lower than non-oil imports of US$ 28010.21 million in March, 2015. Non-oil imports during April-March, 2015-16 were valued at US$ 296933.91 million which was 4.12 per cent lower than the level of such imports valued at US$ 309707.92 million in April-March, 2014-15.

Trade in Services (for February, 2016, as per the RBI Press Release dated 18th April, 2016)

Exports (Receipts)

Exports during February, 2016 were valued at US$ 12329.00 Million (Rs. 84130.26 crore).

During February, 2016, on month-on-month basis, growth in services export remained negative (with a growth of 1.94 per cent) as compared to negative growth (10.44 per cent) during January 2016 (as per RBI’s Press Release for the respective months).

Imports (Payments)

Imports during February, 2016 were valued at US$ 7189.00 million (Rs. 49056.08 crore).

Trade Balance

Merchandise: The trade deficit for April-March, 2015-16 was estimated at US$ 118459.37 million which was lower than the deficit of US$ 137694.95 million during April-March, 2014-15.

Services: As per RBI’s Press Release dated 18th April 2016, the trade balance in Services (i.e. net export of Services) for February, 2016 was estimated at US$ 5140 million. The net export of services for April- February, 2015-16 was estimated at US$ 64600.21 million which is lower than net export of services of US$ 69136.42 million during April- February, 2014-15. (The data for April-February 2015-16 has been derived by adding April-December 2015-16 with month wise QE data of RBI Press Release dated 18th April 2016).

Overall Trade Balance: Taking merchandise and services together, overall trade deficit for April-March, 2015-16 estimated at US$ 53859.16 million as compared to US$ 68558.53 million over same period last year has fallen by 21.44 per cent (Services data pertains to April- February as February 2016 is the latest data available as per RBI’s Press Release dated 18th April 2016).

Merchandise Trade

Exports & Imports: (US $ Million)

(Provisional)

 

March

April-March

Exports (including re-exports)

 

 

2014-15

24032.55

310338.47

2015-16

22718.69

261136.80

%Growth 2015-16/ 2014-15

-5.47

-15.85

Imports

 

 

2014-15

35428.72

448033.42

2015-16

27789.56

379596.17

%Growth 2015-16/ 2014-15

-21.56

-15.28

Trade Balance

 

 

2014-15

-11396.17

-137694.95

2015-16

-5070.87

-118459.37

Services Trade

Exports & Imports (Services): (US $ Million)

(Provisional)

February 2015-16

Exports (Receipts)

12329.00

Imports (Payments)

7189.00

Trade Balance

5140.00

Source: RBI Press Release dated 18th April 2016