Domestic products may find more purchasers as imports tend to go up during August month trade deficit and decrease in Export.
India records an unforeseen increase in imports this year in August compared to exports resulting in a trade deficit that stands at a rounded $13.9 billion. In the previous year, the country’s exports did not see a rise.
This year, they increased by 45.17% to $33.14 billion compared to $22.83 billion of last year in the same month and 27.5% before the pandemic era.
What took place in the month of August
This year India imported superfluously, increasing the import rate to a whopping 51.47% to $47.01 billion compared to $31.03 billion in the same month the previous year.
The topmost items to be imported to India included oil, gold, iron and steel shipments. Gold saw extreme demand in India and alone contributed to 88% of this year’s trade deficit.
On the other hand, exports rates hiked by a considerable percentage because of enormous demands regarding engineering products, petroleum-based products and gems and jewellery.
However, the Ministry of Commerce and Industry acknowledged that this inflation in Export might result from low demand in the domestic territory due to the coronavirus pandemic.
In August 2021, the price of non-petroleum exports was $28.58 billion, indicating a healthy rise of 36.57 per cent over non-petroleum exports of $20.93 billion in the same month last year and a constructive increase of 25.44 per cent over non-petroleum exports of $22.78 billion in August 2019.
Import value of the non-petroleum merchandise was $35.37 billion this year in August with a compelling growth of 43.88 per cent compared to non-petroleum imports of $24.58 billion in August of the previous year and had a productive escalation of 22.58 per cent only over non-petroleum imports of $28.85 billion in August 2019.
$400 Billion export target announced
It is pretty praiseworthy that exports have maintained the growth impetus for the last nine months as monthly exports remained more than $30 billion for six successive months.
India’s exports soared 47.19 per cent to $35.17 billion in July of this year. Imports during the past month also increased by 59.38 per cent to $46.40 billion, creating a trade deficit of $11.23 billion.
According to A Sakthivel, president of the Federation of Indian Export Organizations, the steady increase in exports since March of 2021 signifies positivity for the entire economy. India now aims to reach the export target of $400 billion in the current fiscal year.
Products that got Exported and Imported
As an overview, some of the critical items which have added to the export hike and trade deficit this year are listed below:
1. Petroleum products increased by 45.5% every month to $5.9 billion.
2. Gems & jewellery increased by 22.4% to $3.5 billion.
3. Readymade garments increased by 38.6% to $1.4 billion.
4. Drugs and pharmaceuticals hiked to 6.1% at $2.1 billion.
5. Engineering goods jumped at 2.5% to $9.5 billion.
6. Electronic goods rose by 19% to $1.2 billion.
7. Demand for gold was the highest in imports, rising 333.4% from one month to another to $4.2 billion in July.
8. Coal, coke and briquettes increased by 4.6% to $2 billion.
9. Crude petroleum and other petroleum-based products jumped up to 20.8% at $12.9 billion.
10. Machinery, electrical & non-electrical contracted 8.8% to $2.8 billion.
11. Electronic goods increased by 15.7% to $5.3 billion.
12. Demand for precious and semi-precious gems inflated by 2.2% at $2.6 billion.