India’s Trade Deficit Widened to $23.5 Billion in July: Surge in Imports and Drop in Exports

India's trade deficit, or the gap between imports and exports, widened to $23.5 billion in July, compared to $19 billion in the same month last year, according to data released by the Commerce Ministry.

The trade deficit also widened on a month-on-month basis, compared to the $20.98 billion recorded in June.

India’s Imports Surge

The trade gap widened largely due to a surge in imports. Last month, India’s imports increased by almost 7.45% to $57.48 billion, compared to $53.49 billion in July 2023.

India’s Exports Decline
On the other hand, India’s exports in July declined by 1.2% to $33.98 billion, down from $34.39 billion in the same month last year. This also shows a reversal on a month-on-month basis. In June this year, merchandise exports had risen by 2.56% to $35.2 billion, even as the trade deficit widened.

Faster Imports Growth
During the April-July period of the current fiscal year, India’s merchandise exports increased by 4.15% to $144.12 billion. However, import growth has outpaced exports, surging by 7.57% to $229.7 billion.

Commerce Secretary’s Take
Despite the widening trade deficit, the government expects stronger export growth in FY2024. Discussing the trade data with the media, Commerce Secretary Sunil Barthwal expressed confidence that the country’s total exports of goods and services will surpass last year's figure.