Continuing the healthy pick-up in exports, shipments from the country rose 10.22 per cent in June, even though a sharp 65.13 per cent rise in gold imports whittled the otherwise healthy set of numbers.
"The reduction in trade deficit was driven by 9.3 per cent growth in exports to USD 80.11 billion in Q1 and a sharp fall in gold imports compared to the same period a year ago," credit rating agency Crisil said in a statement.
"The increase in exports was backed by strong growth in engineering goods, ready-made garments and petroleum products which is a reflection of improving global demand," it said.
Further, the agency said: "The reduction in gold imports to USD 7.1 billion in Q1 FY15 from USD 16.4 billion in Q1 of FY14 was due to curbs on importing gold since July 2013."
However, June a saw sharp spike in the inward shipment of the metal. After registering a negative growth since last October, gold imports in June jumped 65.13 per cent to USD 3.12 billion from USD 1.88 billion during the same month last year.
Overall, imports dipped by 6.92 per cent to USD 113.19 billion during the first quarter of the fiscal, according to the government data released today.
Care Ratings said, going forward, growth in exports will be largely determined by the state of the economy of the trade partners, which would tend to improve thus providing support.
"Oil imports would be linked to both the pace of recovery in industry as well as global price of crude which has shown signs of stabilisation following the Iraqi crisis. Non-oil imports would tend to pick up as industrial growth recovers thus leading to pressure on the trade deficit, and hence current account deficit," it said.
Care further said that gold imports have been reined in since last year and the Budget 2014-15 has, contrary to expectations, been silent on any liberalisation measures on gold imports.
It added: "In the absence of any firm affirmative action to liberalise gold imports, it would follow a steady path."
India Rating in a note said the exports rose 9.3 per cent in Q1 at USD 80.1 billion. This is indicative of a revival in exports backed by stability returning to the euro-zone and strengthening of US consumer demand.
The World Trade Organisation expects global trade to grow at 4.5 per cent in 2014.