India Balance of Trade

India continues to run a substantial trade deficit.

Published by Ministry of Commerce and Industry, RBI. Updated until the month of November 2017. (Published on December 15th, 2017.)

Recent Data Trend

India's trade balance marginally contracted to USD 13.28 in November 2017 as compared to USD 13.39 billion in the previous year. The expanding trade balance has been an area of concern in the Indian economy.

Exports by India in November grew by 30.79% YoY to reach USD 26.9 billion. The rebound in exports after the contraction by 1.12% in the previous month is a welcome news but it is to be seen if the growth is long-lived. The growth in exports has been erratic throughout 2017. The growth was supported by the increase in gems and jewelry (32.69%), engineering goods(43.76%), petroleum products(47%) and organic and inorganic chemicals(54.28%).

The total value of imports expanded to USD 40.02 billion, an increase of 22.09% YoY. The rise is mainly on the back of import of crude oil and petroleum products(39.14%), electronic goods (24.97%), pearls, precious stones (85.80%) and machinery, electrical & non-electrical products (23.24%). The Prices of the global crude oil has been on the rise and on November 2017 the price of crude oil(Indian basket) rose by 37.9% YoY.

Judging by the country-wise data, India's trade deficit with China expanded to 5.79 billion in September 2017, the latest time point for which data is available. The huge trade deficit with China has been a major political and economic issue in India. The trade deficit with China has been expanding even though exports have been increasing at a healthy pace since November 2016.

Trade balance with another major trading partner of India, UAE, increased to 1357.88 billion in September 2017 from 11.1 billion in the same period the previous year. India's export to UAE mainly consists of gems and jewelry, refined petroleum products and manufactured textile items.

The poor performance of the export sector of India due to the decreased competitiveness of Indian goods the international market has reflected in the current account balance of India. The CAD worsened to 1.2% of GDP from 0.6% of GDP a year ago. The recent review of the Foreign Trade Policy(FTP) has generated various trade promotion schemes that are expected to help out the exporters and reduce the huge trade deficit that India has been regestering recently.

Brief Overview

The balance of trade data records the value of merchandise trade of India with its trading partners. The data on import and export of the Indian economy is published by the Ministry of Commerce on a monthly basis. Merchandise trade is a key indicator of the development of the economy. India’s largest trade partners include US, EU, and China. India has maintained an overall trade deficit since 1990 and in the past decade, the deficit has increased manifold. According to World Trade Organization, India’s share export of merchandise goods in 2015 was 1.5%.

For more information visit the official government website

Next Release Date: Second week of January 2018

Trade Balance-Quarterly