India’s trade deficit narrows to $20.13 billion in June

India’s trade deficit narrowed to $20.13 billion in June from $22.12 billion in the previous month as the country’s exports as well as imports dipped amid slowdown in major economies.

The country's merchandise exports slumped by 22% year-on-year to $32.97 billion in June as compared to $42.28 billion in the same month last year, as per data released by the Ministry of Commerce and Industry on Friday.

India’s imports dipped from $64.35 billion in June 2022 to $53.10 billion in June 2023, registering a decline of 17.48%.

India's exports remained weak due to several reasons including a slowdown in the world's major economies, Commerce Secretary Sunil Barthwal said.
As per the World Bank Global Economic Prospects report (June 2023) the global economy is set to slow substantially in 2023, to 2.1%, after growing at 3.1% last year.

India’s overall exports (merchandise and services combined) fell to $60.09 billion in June, which is 13.16% lower when compared with the June 2022 figure of $69.20 billion. Overall imports dipped by 13.91% to $68.98 billion.

Most of the sub groups of exports reported a YoY contraction in June 2023, reflecting an unpalatable combination of lower demand and commodity prices, said Aditi Nayar, chief economist at ICRA.

Under merchandise exports, only 9 of the 30 key sectors exhibited positive growth in June 2023 as compared to the same period last year (June 2022). In absolute terms, petroleum products accounted for half the fall in exports in June 2023 relative to June 2022.

The overall trade deficit for April-June 2023 fell to $22.59 billion as compared to the deficit of $31.49 billion recorded in April-June 2022 period. The merchandise trade deficit during April-June 2023 stood at $57.60 billion, which is 7.92% lower when compared with $62.55 billion recorded in April-June 2022.