Bad news for economy: Exports shrink; trade deficit widens

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Updated: August 14, 2018 6:37:48 PM

In a bad news for the economy, the trade deficit expanded to $18.02 billion in July as against $16.60 billion last month as oil imports surged 57.41 percent to $12.35 billion.

trade war, US china trade war, chinese goods, american tarrifs, chinese market, chinese exports, us china economyThe trade deficit in the month of June recorded a peak of 61 months reaching .6 billion. (Representational Image: Reuters)

In a bad news for economy, the trade deficit expanded to $18.02 billion in July as against $16.60 billion last month as oil imports surged 57.41 percent to $12.35 billion, government data showed. The exports shrank to $25.77 billion as against $27.70 billion in previous month and July imports reached $43.79 billion as against $44.30 billion in the month of June. However, the merchandise exports rose 14.32 percent year-on-year in July. In June, the trade deficit stood at $16.6 billion. The July gold imports rise to $2.96 billion in July compared to $2.39 billion in June.

The oil imports in the same month reduced to $12.35 billion as against $12.7 billion in June. The import of electronic goods also rose to $5.12 bn as against $4.89 billion in June, the data showed.

Meanwhile, trade deficit in the month of June recorded a 61-month peak reaching $16.6 billion on back of surge in net oil import bill. The rise in oil imports offset gains from a reduction in imports gold and precious stone, official data said. The current account deficit touched 1.9 percent of GDP in fourth quarter of FY18. It is marginally lower than 2.1 percent what was recorded in the last quarter.

However, it was higher than 0.4 percent a year back. In the month of June imports rose 21.3 percent which is the fastest growth in five months. The exports growth cooled sequentially yet touched 17.6 percent in the month of June. A decent enough expansion was seen in the engineering goods, chemicals and pharmaceutical products.

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