Export growth hit a 41-month low in June as poor performance plagued all major foreign exchange earners including petroleum oil, gems and jewellery, and engineering goods. Imports also dipped by 9.06 per cent, a 34-month low in June. Consequently, the trade deficit went down by nearly 8 per cent to $15.28 billion in June, a three-month low.
In June, outbound trade contracted by a significant 9.7 per cent, after rising by 3.93 per cent in May. According to data released by the Commerce and Industry Ministry on Monday, exports stood at $25.01 billion in the month.
The government has blamed this on a high base effect and overwhelming global trading conditions. “While average exports in June have been $22-23 billion since 2015-16, the exports in June 2018, were relatively quite high at $27.7 billion,” the commerce ministry said.
Critical exports such as processed petroleum took a beating, with receipts falling by a steep margin of 32.85 per cent to $2.73 billion. This was due to refineries in Jamnagar and Mangaluru being shut over the month, Commerce Secretary Anup Wadhawan said.
He said exports in the sector are expected to go up in the coming months. Imports also reduced in June after rising at a six-month high pace of 4.4 per cent in May. The largest component of the import bill — crude oil — saw the cost of inbound shipments fall by 13.33 per cent to $11 billion. Crude imports had risen by 8.23 per cent in the previous month. However, the second-largest item in the import bill — gold — continued to see a rise in inbound trade.