NEW DELHI: The continuing of high crude and gold imports pushed India’s trade deficit to a six-month high of $15.36 billion in May, even as export growth managed to recover from the rock bottom it had hit in April.
Higher exports in key sectors, such as engineering goods and textiles, helped overall export growth recover in May to 3.93 per cent, from just 0.64 per cent in April, report agencies.According to data released by the commerce and industry ministry on Friday, exports stood at $29.99 billion in May. Interestingly, hot global crude prices have not led to higher realisations from petroleum receipts, which fell by 1.4 per cent in May. Cumulative exports in FY20 stood at $56.07 billion. Outbound trade has remained volatile with export growth reaching double digits for the first time in five months in March.
Of the 30 major product groups, 17 recorded a growth in May, up from 14 in April.
Trade deficit at 6-month high of $15.4 bn over increasing oil, gold imports. After being one of the growth pullers in the previous financial year, engineering goods rose by 4.4 per cent in May, as compared to the 7 per cent contraction in April. The sector had shown signs of recovery in the past few months and growth had been 16.2 per cent in March. The sector accounts for nearly one-fourth of the total foreign exchange earned through exports.
Elsewhere, readymade garments, the sector in which India’s export competitiveness has steadily fallen over the past financial year, showed signs of steady recovery with $1.52 billion worth of merchandise exported in May. Growth jumped to more than 14 per cent, up from the 4.42 per cent in April.
The case was similar to drugs and pharmaceuticals exports which also managed to rise by 10.98 per cent in May. Growth in the sector has swung wildly in 2019 with a 4 per cent rise in April, and 13.59 per cent growth in March.
For gems and jewellery, contraction that had gripped the sector periodically since November, continued in May when the sector contracted by 7.38 per cent, to ship out $3.41 billion worth of goods. Gem exports had retreated by 13.38 per cent in the previous month of April.