Goods exports & imports plunge over 20% in June

livemint.com:

New Delhi: Declining demand and prices worldwide dragged down India’s exports and imports by more than 20% each in June, trade data released on Friday showed. Merchandise exports fell for the fifth consecutive month, registering a steep 22% decline to $32.97 billion from $42.28 billion a year earlier. The value of petroleum product exports plunged nearly 50% during the period, as prices of refined crude products fell.

Global commodity prices continued to ease during the month, and exports of petroleum products, gems and jewellery and engineering goods, among others, showed no sign of picking up. Imports fell as well, declining over 21% to $53.1 billion from $64.35 billion in June 2022. Trade balance, or the difference between imports and exports, also narrowed to $20.13 billion in June against $22.07 billion last year, data released by the commerce ministry showed on Friday.

Trade experts said imports would ease further in line with falling global commodity prices, and that domestic demand may see some correction which will also keep the import bill muted. Current account deficit is also expected to ease in FY24, which would support the domestic currency. India’s current account deficit had earlier narrowed sharply in the fourth quarter of FY23 to $1.3 billion owing to a moderation in trade deficit and robust services exports.

India’s export weakness is in line with a similar slowdown in China’s exports, which contracted in June at the fastest pace since the outbreak of the covid-19 pandemic. On declining exports, a government official said that weak demand from western countries had led to an inventory glut that is now showing signs of easing as orders have pick up. However, the global trade situation continues to be