1. Trade deficit widens, CAD worries

Trade deficit widens, CAD worries

An over six-fold jump in gold imports resulted in overall imports recording a 27% year-on-year jump in November, in turn...

By: | Updated: December 16, 2014 10:36 AM

An over six-fold jump in gold imports resulted in overall imports recording a 27% year-on-year jump in November, in turn widening the country’s trade deficit to an 18-month high of $16.86 billion in the month, sparking fresh worries over the current account deficit (CAD).

In the second quarter ended September 30, the CAD stood at a five-quarter high of  $10.1 billion or 2.1% of gross domestic product owing mainly to an increase in merchandise imports propelled by rising demand for the yellow metal, while export growth remained slow.

Gold imports in November were $5.61 billion as against $836 million in the same month last year. While oil imports fell by 9.7% to $11.71 billion in the month, thanks to a fall in global crude oil prices, non-oil imports, including capital goods, recorded 49.6% growth to $31.10 billion.

This resulted in total imports in the month registering 26.79% growth to $42.82 billion.


The imported goods sectors that registered high year-on-year growth included those from segments such as fertilisers (136% growth to $1.1 billion), gold (571%), silver (144% to $644 million), coal (44% to $1.8 billion), chemicals (16% to $1.6 billion), pearls and precious stones (37% to $2.1 billion) and iron and steel (62% to $1.4 billion).

Machinery, electrical and non-electrical imports rose 20.3% to $2.5 billion, while transport equipment imports grew 23% to $2 billion.

Electronic goods also registered 29.5% jump to $3 billion.

Meanwhile, exports grew by 7.27% to $25.96 billion after shrinking by a little over 5% in October. The sectors that have fared well include engineering goods (30% growth to $6.6 billion), gems and jewellery (44% to $3.7 billion), chemicals (16% to $1.1 billion) and drugs and pharma (9% to 1.2 billion).

Owing to weak demand overseas, several sectors registered low or negative growth, including electronic goods, petroleum products and farm products. Petro products exports shrunk by 14% to $4.1 billion.

During the fiscal so far, imports grew 4.65% to $316.37 billion, while exports were up 5.02% to $215.75 billion. The trade deficit during April-November this fiscal was $100.61 billion as against $96.89 billion in the corresponding period last fiscal.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Go to Top