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- According to data released by the Ministry of Commerce,India’s trade deficit has widened to a six-month high of $15.4 billion in May,2019.
- The trade deficit has widened due to import growth outpacing export growth following a 37% jump in gold imports.
- The rising crude oil prices due to sanctions on Iranian oil imports could further increase imports and put pressure on India’s current account deficit.
- Further,India’s exports also grew by 3.93% following a growth in many key sectors such as engineering goods, iron ore and leather products.
- However,escalating trade war between the US and China and rising protectionism have cast a shadow on India’s prospects for higher exports.
- A trade deficit is an economic measure of international trade in which a country’s imports exceed its exports.A trade deficit represents an outflow of domestic currency to foreign markets.
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