India may exports UO 67% YoY at $32.21 BN trade deflcit at 8-month low

Demand for outbound shipments from India continued to be on the rise, with India’s merchandise exports estimated at $32.21 billion in May, up 67.39 per cent year-on-year, and 7.93 per cent as compared with May 2019. Exports grew 5.15 per cent on a sequential basis. The year-on-year growth can be attributed to a weak base due to the disruption caused by a nationwide lockdown last year. However, compared with the pre-pandemic period and April 2021, the latest data released by the government is emblematic of recovery in external demand. The growth was driven by a rise in demand for engineering goods, petroleum products, gems and jewellery, pharmaceuticals and iron ore. Preliminary data released by the commerce and industry ministry showed that Merchandise exports in the first two months of the fiscal year was $62.84 billion, up 12.44 per cent as compared to April-May 2019.

Export were not immediately affected by the imposition of the lockdown across various states to contain the devastating resurgence of Covid-19 spread from April. Exporters said that the impact of lockdown in several states was limited, unlike last year when the nationwide lockdown was far more stringent. India’s merchandise imports declined to a six-month low in May at $38.53 billion, as state-specific curbs amid the second wave of the pandemic hurt domestic consumption. Imports grew 68.54 per cent on-year. On a sequential basis, imports were down 18.66 per cent, and fell 17.47 per cent as compared to May 2019.

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