India’s Trade Deficit Widens To US$30.4 Billion In June

India's June trade data presented a mixed picture. While India's trade deficit widened to US$30.4 billion as imports continued to outpace exports, total outbound shipments during the April-June quarter touched a record high, reflecting steady demand for Indian goods and services.

Commerce Secretary Rajesh Agarwal said India's exports remained on a healthy growth path, with exports in June rising 7.3% compared with the same month last year.

Why Did The Trade Deficit Increase?

India's merchandise exports stood at US$40.4 billion in June. Merchandise imports rose 31% year-on-year to US$70.8 billion. The figures led to a wider trade gap. Services trade remained strong during the month. Services exports were estimated at US$33 billion, while services imports were pegged at US$17.9 billion.

The June trade deficit was also higher than May's US$28.21 billion, extending the recent rise in the country's import bill.

Which Sectors And Markets Supported Export Growth?

Electronics, rice, iron ore, handicrafts, poultry products and marine products were among the strongest-performing export categories during June. Engineering goods, petroleum products and electronics continued to be India's largest export segments.

The US, the UAE and Singapore remained India's top export destinations during the month. At the same time, stronger shipments to China, Singapore and South Africa, along with resilient demand from the Middle East, helped offset weakness seen in some other markets earlier this year.

On the import side, China, Russia and the US continued to be India's biggest suppliers.

Why Is The Quarterly Export Record Significant?

India's total exports of goods, merchandise, and services during April-June were US$232.7 billion. This is an 11.4% growth against the same period in the last financial year, making it the country's highest-ever quarterly exports. Even though the total trade deficit was higher, India recorded a robust export performance during the same quarter.

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