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India’s merchandise exports bounced back in April after declining for two consecutive months while a drop in imports helped narrow the trade deficit and ease pressure on the external sector and the rupee.
During April, merchandise exports grew 5.26% to $25.6 billion, while imports shrank 15% to $35.7 billion, leaving a trade deficit of $10.1 billion.
Oil imports fell 0.6% to $13 billion while non-oil imports, which signal the robustness of domestic demand shrank 21.5% to $22.7 billion.
Among major export items, gems and jewellery shipments contracted 8.1% to $3.3 billion in April while engineering goods exports rose 21.25% to $5.7 billion. Petroleum product exports grew marginally by 0.72% to $5.2 billion, while ready made garments shipments rose 14.33% to $1.3 billion during the same month.
A pick-up in exports and curbs on gold imports helped India to rein in its current account deficit in the second and third quarters of 2013-14. India’s current account deficit narrowed to 0.9% of gross domestic product (GDP) in the quarter ended December, from 1.2% of GDP in the preceding quarter.
A large trade deficit made the Indian economy vulnerable to external sector shocks and saw the Indian currency touching a record low of almost 69 per dollar in August.
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